Apple sued over fake Bitcoin wallet in App Store, leading to $1.8 million loss

Apple is facing a lawsuit in federal court in California due to the presence of a fake cryptocurrency application in the App Store. According to the plaintiffs, the company allowed serious lapses in software control, which enabled scammers to steal a total of approximately $1.8 million from three users.

Scam Details

Plaintiffs James Ramirez, Christopher Ellis, and Jalen Delgado claim they were robbed between May and August 2025. The fraudulent app mimicked the popular Sparrow Wallet – software that is primarily available only for Windows, macOS, and Linux operating systems and has no official version for iOS.

The attackers used the appearance of the legitimate product to lure users into entering their wallet recovery data. Through this method, they gained full control over the victims' funds, who lost $875,000, $840,000, and $120,000 respectively.

Allegations of Consumer Protection Violations

The lawsuit states that Apple violated consumer protection laws in California. The plaintiffs claim that the company built an image of security and thorough app vetting, which misled victims into believing that software in the App Store is reliable. They also accuse Apple of a slow response to reports of fraudulent activities.

The developer of the original Sparrow Wallet, Craig Row, had already signaled the presence of fake versions as early as January 2024, sharing that the fraudulent app remained in the store for weeks despite his repeated reports.

Conflict with Developers

The case is also accompanied by an incident involving Row himself. After he attempted to protect users through his own app, Apple initially flagged his account as fraudulent and began a termination process before later reversing its decision. This incident highlights the difficulties legitimate developers face in protecting their brands from imitations.

The three plaintiffs are demanding full compensation and the return of the stolen funds. The outcome of the case will call into question the extent to which tech giants are held responsible for the security of the software they allow into their ecosystems.