Apple sued after fake Bitcoin wallet costs users $1.8M
What's the story
Apple is facing a lawsuit from three customers who lost a total of $1.8 million due to a fraudulent Bitcoin wallet app on the App Store. The complaint was filed in California federal court on Friday and accuses Apple of violating California's Consumers Legal Remedies Act and other laws by not properly reviewing and monitoring apps on its platform.
Misleading assurance
Plaintiffs trusted the fraudulent Sparrow Wallet app
The plaintiffs, James Ramirez, Christopher Ellis, and Jalen Delgado, trusted the Sparrow Wallet app they downloaded from the App Store on iOS.
The real Sparrow Wallet is only available on Windows, macOS, and Linux.
The complaint states that "this fraud succeeded precisely because Apple exploited the consumer trust it had deliberately cultivated through more than a decade of marketing the App Store as a uniquely safe and trusted environment."
Financial loss
Losses occurred between May and August 2025
The plaintiffs lost substantial amounts of Bitcoin through the fraudulent app between May and August 2025.
Ramirez lost about $875,000, Ellis around $840,000, and Delgado roughly $120,000, leading to combined loss of $1.84 million.
The lawsuit also claims that Apple often took little to no action even when victims reported fraud and that other fake Sparrow apps still remain on the App Store.
Developer's criticism
Developer criticized Apple's slow response
Sparrow Wallet developer Craig Raw has publicly criticized Apple's slow response to the emergence of fake versions of his app on the App Store.
Last month, Raw said his efforts to protect users by submitting a "placeholder" app with marketing screenshots stating that Sparrow Wallet is a desktop app only led to his Apple Developer account being flagged for termination due to "dishonest activity."
Legal demands
Plaintiffs seek damages and want Apple to provide warnings
The plaintiffs are seeking damages, including reimbursement of all funds lost through the fraudulent Sparrow Wallet app.
They also want Apple to provide warnings and disclosures about the risks associated with its App Store.
In response to a request for comment, Apple said it has acted quickly to remove any apps impersonating Sparrow Wallet on the App Store and terminate developer accounts associated with those apps.