Apple, Google Face US Lawmakers' Scrutiny Over Crypto Scam Apps

U.S. lawmakers have asked Apple Inc AAPL and Alphabet Inc GOOG GOOGL to provide information on how they review fraudulent cryptocurrency apps and prevent potential scams.

What Happened: Sen. Sherrod Brown (D-OH), Chairman of the Senate Committee on Banking, Housing, and Urban Affairs, sent letters on Thursday, demanding answers from Apple CEO Tim Cook and Alphabet chief Sundar Pichai.

“Cyber criminals have stolen company logos, names, and other identifying information of crypto firms and then created fake mobile apps to trick unsuspecting investors into believing they are conducting business with a legitimate crypto firm,” he wrote.

“Alarmingly, far too many investors have fallen victim to such scams with losses exceeding $42 million.”

Brown was referring to a recent report from the Federal Bureau of Investigation (FBI) that revealed 244 investors had fallen prey to scams worth $42.7 million by fraudulent cryptocurrency apps.

The lawmaker said it was imperative that app stores have proper safeguards in place to warn investors about potential fraudulent activity. Brown asked Apple and Google to describe the review process taken before approving an app on their platforms, actions taken to alert people about scams, and processes they have in place to report fake apps.

The tech giants were asked to respond to the senator’s requests by Aug. 10.

Price Action: The cryptocurrency market rose 4.59% over 24 hours to $1.09 trillion. As per data from Benzinga Pro, at press time, Bitcoin BTC/USD was trading at $23,879, up 5% over 24 hours, while Ethereum ETH/USD was up 6.58% at $1,719.