Google has taken legal action against suspected crypto scammers who allegedly uploaded deceitful investment apps onto Google Play.
Filed in the Southern District of New York on Thursday, the lawsuit accuses Yunfeng Sun and Hongnam Cheung of numerous acts of wire fraud. The alleged fraud harmed Google and affected around 100,000 users of Google, reported CoinDesk.
The fraud scheme members enticed victims with promises of high returns through seemingly legitimate apps. These apps displayed fake investment gains, leading victims to believe they were profiting.
However, when victims tried to withdraw funds, defendants demanded additional fees, prolonging the scam.
Despite Google's efforts to combat the scheme by suspending fraudulent apps, defendants persistently uploaded new ones, using different network infrastructure and accounts to conceal their identities.
The filing claimed, "Defendants made multiple 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 application being uploaded."
The defendants or their representatives made videos on websites like YouTube to advertise the fake investment apps. They also used both online and in-person marketing tactics to persuade people to join the apps as "affiliates." These affiliates were promised commissions for getting more users to sign up.
"This is a unique opportunity for us to use our resources to actually combat bad actors who were running an extensive crypto scheme to defraud some of our users," Halimah DeLaine Prado, general counsel at Google, said in an interview with CNBC.
She added, "This [lawsuit] allows us to not only use our resources to protect users, but to also serve as sort of a precedent to future bad actors that we don't tolerate this behaviour."
According to Prado, in 2023 alone, Google saw over a billion dollars within the US of cryptocurrency fraud and scams.
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