More than 100,000 people bought into an international cryptocurrency scam, lured to “invest” by YouTube videos, affiliate marketing campaigns and romance scam messages, Google said in a complaint filed Thursday in a New York district court.
Google has filed a lawsuit against two developers who allegedly created 87 fraudulent crypto apps over the course of at least 5 years on the Google Play Store.
Google accused the developers of targeting thousands of victim “investors”, who were not investing in cryptocurrencies at all, but instead putting money directly into the developers’ pockets.
According to the complaint, the victims lost anywhere from 100 to tens of thousands of dollars each.
Google CEO Sundar Pichai. Photo credit: Justin Sullivan/Getty Images
According to the complaint, the developers used a few tactics to get victims to download their apps: One was sending text messages to potential victims that were supposed to appear as if they were sent to the wrong number.
The victim would receive a text along the lines of “I always miss you, how are your parents Mike?” and if they responded, even with a “wrong number”, the developers or people working on their behalf would try to form a friendship or romantic relationship to convince the victim to download one of their crypto apps and deposit money.
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The problems would begin when the victim attempted to withdraw their funds. The platform would not allow them to access their money and the “friend” who told them about the app would stop responding to their messages.
The customer service lines were not working, or when they were working, the company representative asked for additional withdrawal fees ranging from 10% to 30%, saying these fees were necessary for commissions or taxes.
According to the complaint, even if the victim paid the additional fees, they would still not receive the funds initially deposited.
Google cited TionRT, Starlight and SkypeWallet as some examples of fraudulent apps in the complaint. The company is asking the court to award it an unspecified sum in damages and to block the defendants from accessing any Google services.
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App developers or their agents have also created videos on YouTube designed to legitimize their crypto apps, even paying actors to pose as the “management team” behind the apps.
They also launched affiliate marketing campaigns, promising users they would earn commissions by signing up other users to the apps, and issuing public press releases
When Google pulled developer-created apps from its app store in response to customer complaints, the developers spoofed their identities and started over, Google said.
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“Defendants made numerous misrepresentations to Google in order to upload their fraudulent apps to Google Play, including, but not limited to, misrepresentations about their identity, location, and the type and nature of the uploaded application,” the complaint reads by Google.