During the Senate Banking Committee hearing, Senator Brown said that regulators and lawmakers should take the burden of crypto scams running on online platforms.
As the crypto market matures, bad actors have been throwing their baits via different means. This includes Elon Musk impersonators to dubious crypto Discord channels. In the latest development, the chairperson of the Banking Senate Committee – Senator Sherrod Brown – wrote a letter to the CEOs of Apple and Google asking them to provide information on alleged fake crypto apps and the preventive actions undertaken by the two tech giants.
The Senator published the letters written to Alphabet CEO Sundar Pichai and Apple CEO Tim Cook on the steps the two tech giants have taken for crypto apps to list on the Google Play Store and the App Store. He also inquired about how the two companies assessed whether the apps were “trusted and secure”. Brown wrote:
“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. While firms that offer crypto investment and other related services should take the necessary steps to prevent fraudulent activity, including warning investors about the uptick in scams, it is likewise imperative that app stores have the proper safeguards in place to prevent against fraudulent mobile application activity.”
Both Apple and Google have up to August 10 to respond to Senator Brown’s letter.
The surge in Fraudulent Crypto Apps
earlier this month on July 18, the Federal Bureau of Investigation (FBI) issued a public warning of the surge in fraudulent crypto apps. Between October 2021, and May 2022, scammers siphoned more than $42 million from 244 people. This also included a case wherein an app used the name of a very popular crypto exchange.
Speaking at Thursday’s hearing, Senator said that the burden of reporting crypto scams on platforms lies on regulators and lawmakers. He added:
“We hear industry players call for rules of the road when a big fraud is uncovered, and after a big actor has knowingly violated the law. The rules are there, the roadmap is clear, and [the Senate Banking Committee] needs to make sure our regulators enforce the law and protect the workers and families that keep this economy rolling […] Industry shouldn’t be allowed to write the rules that they want to play by.”
Last year in June 2021, financial regulators charged $57 million in fines to crypto trading app Robinhood.
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
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