Apple Faces Class-Action Lawsuit Over Fake Crypto Wallet App That Stole $1.8M in Bitcoin
A group of three individuals has filed a class-action lawsuit against Apple, alleging that the tech giant’s failure to properly review and monitor apps distributed through its App Store led to the theft of approximately $1.8 million in Bitcoin. The plaintiffs claim that they downloaded a fake Sparrow Wallet application from the App Store, which impersonated the legitimate cryptocurrency wallet and tricked them into entering their seed phrases, allowing scammers to steal their digital assets.
The lawsuit, filed on July 24 in California, accuses Apple of negligence and breach of contract for promoting the App Store as a safe and trusted source for software. The plaintiffs argue that Apple’s lax review process allowed malicious apps to slip through, causing significant financial losses for users. In this case, the fake Sparrow Wallet app was able to deceive victims into transferring their Bitcoin to cryptocurrency wallets controlled by scammers.
The legitimate Sparrow Wallet is a desktop application available for Windows, macOS, and Linux, but does not offer an iOS version. However, the developer of the legitimate Sparrow Wallet has repeatedly warned users about the existence of fake apps impersonating his software in Apple’s App Store. In fact, the developer had reported instances of scams to Apple more than a year before the plaintiffs’ losses, yet no action was taken.
The plaintiffs claim that Apple not only failed to remove the malicious app but also ranked it and included it in curated cryptocurrency app collections, effectively recommending it alongside legitimate applications. This incident highlights the need for users to be cautious when downloading apps from the App Store, especially those related to cryptocurrency, as they often serve as a target for scammers.
Apple has responded to the allegations by stating that it acted quickly to remove the fake Sparrow Wallet apps and terminated the developer accounts associated with them. However, the company’s response raises questions about its review process and whether it is doing enough to prevent such incidents in the future.
The lawsuit seeks reimbursement for the stolen cryptocurrency, compensatory and punitive damages, restitution, attorneys’ fees, and other damages. The plaintiffs are also asking the court to require Apple to improve and publicly disclose its procedures for detecting and removing fraudulent applications, as well as introduce warnings about the risks associated with cryptocurrency apps.
As this case highlights, it’s essential for users to be vigilant when downloading apps from the App Store, especially those related to sensitive topics like cryptocurrency. It’s also crucial for Apple to take a more proactive approach in reviewing and monitoring its app ecosystem to prevent such incidents from occurring in the future.
Source: Bleeping Computer — 2026-07-27