Apple Sued Over Fake Wallet App

Apple is facing a lawsuit in California after three users lost a combined $1.8 million through a fraudulent cryptocurrency wallet available on the App Store.

The app, which impersonated Sparrow Wallet, was available from May to August 2025. The legitimate software is only available for Windows, macOS and Linux, with no official iPhone version.

The fake app asked users to enter their seed phrases, which the scammers then used to steal their funds. The three victims lost approximately $875,000, $840,000 and $120,000 worth of Bitcoin, respectively.

According to the lawsuit, Apple promotes the App Store as a “safe and trusted” platform, yet failed to block an app published by an unofficial developer. Moreover, the fake wallet appeared in curated collections of cryptocurrency apps, making it seem more credible.

Craig Raw, the creator of Sparrow Wallet, testified that he had repeatedly reported copies of his software over the years, without success. When he attempted to publish a simple text-based app warning users that no mobile version existed, Apple allegedly threatened to suspend his developer account.

The lawsuit accuses Apple of false advertising and violating consumer protection laws. The victims are seeking the return of their Bitcoin, punitive damages and a court order requiring the App Store to display clear warnings about fraudulent apps.

Apple declined to comment, citing the ongoing legal proceedings. The company removed the app and terminated the developer accounts associated with it. Apple also stated that in 2025 it prevented more than $2.2 billion in fraudulent transactions and shut down 193,000 malicious developer accounts.

Three months earlier, a fake version of Ledger Live had reportedly cost Mac users $9.5 million.