Apple is under legal fire once again this time over its role in allegedly facilitating cryptocurrency fraud via its tightly controlled App Store. A newly filed lawsuit in California claims that the tech giant should be held accountable for hosting a scam app that defrauded a user of $80,000 worth of digital assets, undermining Apple’s long-touted commitment to platform safety.
Filed last week by Danyell Shin, the suit accuses Apple of deceptive practices after she downloaded an app named “Swiftcrypt” from the App Store. The app posed as a legitimate digital asset exchange but instead vanished with her funds and ceased all communication. Shin now seeks to elevate the case to a class action, potentially representing many more victims.
Trust Misplaced in a “Safe and Trusted” Platform
At the heart of the lawsuit is Apple’s alleged failure to protect users from fraudulent applications, despite the company’s branding the App Store as a secure and vetted environment. The complaint cites Apple’s own marketing, including historic remarks by late co-founder Steve Jobs, who championed the App Store as a place where users could safely download programmes “without fear of malicious software.”
“Apple has structured its ecosystem so that customers rely on Apple for the perceived safety and reliability of the App Store,” the lawsuit reads. “As a direct result of Apple’s process for reviewing the Swiftcrypt app… Plaintiff was injured and lost approximately $80,000.”
The lawsuit further alleges that Apple’s exclusive control over how apps are distributed to iPhones gave users a false sense of security. It claims that Shin reasonably believed Apple had properly vetted Swiftcrypt before making it available for download, an assumption that led directly to her financial loss.
Legal Grounds: Competition and Consumer Protection
The lawsuit levies two primary legal claims against Apple: a violation of California’s competition law and a violation of the state’s consumer protection statutes. It argues that Apple’s tightly walled ecosystem, combined with misleading representations about app safety, creates conditions where users are vulnerable to fraud with little recourse once harmed.
In a striking detail, the complaint also asserts that Shin “overpaid” for her iPhone due to Apple’s misrepresentations, claiming that she would not have bought the device or paid as much for it had she known the App Store was susceptible to fraudulent content.
Moreover, the suit emphasises that despite Apple’s promises of safety, users of Swiftcrypt were never alerted by Apple to the app’s fraudulent nature, raising questions about the company’s post-review oversight and incident response protocols.
Class Action Status Yet to Be Determined
Although the case has been filed as a proposed class action, it must still receive court certification before it can proceed as such. That step will involve determining whether there are enough similarly situated victims and whether their cases share common legal and factual issues suitable for group litigation.
Apple has yet to publicly comment on the lawsuit. However, the legal challenge comes amid mounting global scrutiny over the company’s App Store policies and market control.
App Store Under Renewed Legal Spotlight
Apple’s control over its App Store ecosystem has been the focus of major legal battles in recent years. The most prominent example is the Epic Games v. Apple lawsuit, where the game developer accused Apple of monopolistic behaviour by requiring all in-app purchases to go through its proprietary payment system, where Apple takes a 30% commission. While Apple largely prevailed in that case, criticism of its closed system has persisted.
Just this week, a £1.5 billion ($2 billion) anti-competition class action suit began trial in London. The suit argues that Apple’s App Store practices restrict competition and prevent better deals for consumers and developers alike.
A Broader Pattern?
While Shin’s lawsuit centres on one specific app, the broader implications touch on the integrity of Apple’s app approval process and the real-world consequences of app store gatekeeping. As the cryptocurrency sector continues to attract both legitimate developers and sophisticated scammers, platforms like Apple’s will likely face growing pressure to improve safeguards or bear the legal and reputational fallout.
