Google has taken legal action against a group of individuals it accuses of defrauding more than 100,000 people worldwide by distributing fake crypto apps through the Google Play Store, CNBC reported.
The lawsuit was filed on April 4 in the Southern District of New York. The move represents Google’s efforts to combat crypto scams and aims to set a legal precedent for user protection.
Civil claims lawsuit
The defendants, identified in the lawsuit as Yunfeng Sun, aka Alphonse Sun, and Hongnam Cheung, aka Zhang Hongnim or Stanford Fischer, allegedly orchestrated a fraudulent operation by posting at least 87 fake investment and crypto exchange apps on Google Play places.
Google’s complaint states that these individuals provided false information about their identity, location and the nature of their apps.
Halimah DeLaine Prado, Google’s general counsel, emphasized the importance of the lawsuit in tackling crypto fraud, which has led to significant losses in the US. She emphasized the company’s commitment to deploying its resources to protect users and deter fraudulent activities.
The legal action utilizes civil claims under the Racketeer Influenced and Corrupt Organizations (RICO) Act and breach of contract claims. The lawsuit details the methods the defendant used to attract users to their apps, including text messaging campaigns, online videos and affiliate marketing strategies.
Scam apps
Despite the apps’ appearance of legitimacy, including displaying investment balances and returns, users were reportedly unable to withdraw their funds. Some were even tricked into paying extra fees to access their earnings.
The complaint also describes how the alleged scammers attempted to legitimize their apps, such as TionRT, by enabling small initial withdrawals and publishing press releases. However, when users tried to withdraw their larger investments, they received no response.
Google has responded to these deceptive practices by improving its cybersecurity measures, including forming partnerships with law enforcement agencies and setting up a fraud identification team.
The company claims to have suffered damages of more than $75,000 due to research and safety improvement costs. Through this lawsuit, Google is seeking damages and a permanent injunction barring the defendants and their affiliates from accessing Google services or creating accounts.
The lawsuit is part of Google’s broader strategy to protect its users and ensure the integrity of its platform amid rising online scams and cybersecurity threats.