Alphabet Inc.’s Google has filed a lawsuit against two individuals based in China. The tech giant accused them of using the company’s platforms to distribute and advertise fraudulent cryptocurrency apps, according to Bloomberg.
The lawsuit, filed in federal court in New York on Thursday morning, alleges that the defendants engaged in racketeering, violating the Racketeer Influenced and Corrupt Organizations (RICO) statute.
Key points:
- Google claims the alleged scammers used its Google Play and YouTube platforms to distribute and advertise fraudulent crypto apps.
- The defendants are accused of conspiring to engage in a pattern of racketeering by committing hundreds of acts of wire fraud.
- Approximately 100,000 users have downloaded the fraudulent apps from Google Play.
- Victims of the scam were unable to withdraw their balances after investing in the apps.
- Google has taken down the apps as they appear, but says the scammers continue to bypass its fraud detection systems.
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Google sued five individuals last year
This lawsuit is the latest example of Google’s efforts to crack down on fraudsters by taking direct legal action. The previous year, the company sued five individuals who allegedly tricked people looking for Google’s artificial intelligence chatbot into downloading malware onto their computers.
According to the lawsuit, the alleged scammers used various tactics to lure victims into downloading their fraudulent apps, including text messaging campaigns, promotional videos, and online influencers.
The scammers designed the apps to mimic legitimate cryptocurrency investments, but once users invested their money, they were unable to withdraw their balances.
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Google stated that it has identified at least 87 fraudulent apps uploaded to the Google Play Store by scammers since 2019 using business records. The company has been actively taking down these apps as they appear, but the scammers have been able to continuously bypass Google’s fraud detection systems.
Halimah DeLaine Prado, Google’s general counsel, emphasized the company’s commitment to user safety, stating, “This litigation is a critical step in holding these bad actors accountable and sending a clear message that we will aggressively pursue those who seek to take advantage of our users.”
The rise of cryptocurrency investment scams has become a growing concern in the United States. According to a recent report from the Federal Bureau of Investigation (FBI), losses from such scams increased by 53% in 2023, reaching $3.94 billion compared to $2.57 billion in 2022.