HomeWinBuzzer NewsGoogle Initiates Legal Action Against Alleged Cryptocurrency Scam by Chinese Developers

Google Initiates Legal Action Against Alleged Cryptocurrency Scam by Chinese Developers

Google sues app developers for creating 87 fake crypto investment apps that defrauded over 100,000 users.

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has filed a lawsuit against two app developers from , accusing them of creating fraudulent investment applications. The developers, identified as Yunfeng Sun, also known as Alphonse Sun, from Shenzhen, and Hongnam Cheung, also known as Zhang Hongnim and Stanford Fischer, from Hong Kong, are alleged to have developed 87 scam apps between 2014 and 2019. These applications, according to Google, have defrauded at least 100,000 users globally.

The Nature of the Scam

The applications developed by Sun and Cheung masqueraded as cryptocurrency exchanges or investment platforms, promising substantial returns. The lawsuit, filed in the Southern District of New York, details how the apps displayed fictitious account balances that seemed to fluctuate with real-world cryptocurrency exchange rates, creating an illusion of genuine trading activity. Victims were initially permitted to withdraw small amounts to foster trust. However, when larger withdrawals were attempted, users found themselves unable to access their funds. The developers are accused of soliciting additional funds from victims under various pretexts, such as further investments or fees, with the promise of unlocking their accounts.

Marketing and Manipulation Tactics

Google's complaint also sheds light on the sophisticated marketing strategies employed by Sun and Cheung to lure victims into their scheme. These included paid video promotions featuring actors as the leadership team of the fraudulent apps, promising safety and strong returns. The developers also allegedly engaged in social engineering through text message campaigns and established trust through fabricated friendships or romantic relationships before introducing the investment scam. Google asserts that the developers abused multiple Google services, including the , Google Voice, and YouTube, to facilitate their scam, leading to significant financial harm to users and damage to Google's platforms.

Google's legal action marks a significant step in the tech industry's fight against cryptocurrency scams, reflecting the broader issue of investment fraud as a leading form of cybercrime in the US. The lawsuit seeks an injunction to ban Sun and Cheung and their associates from accessing Google services in the future, highlighting the tech giant's commitment to safeguarding its users and platforms from fraudulent activities.

In 2022, the FBI warned of an increase in scam apps seeking to trick investors in crypto to part with millions dollars worth of coins. In its briefing, the FBI says it tracked three fraud campaigns targeting crypto investors between October 2021 and May 2022. Those three attacks were able to fleece over $10 million from customers.

Luke Jones
Luke Jones
Luke has been writing about all things tech for more than five years. He is following Microsoft closely to bring you the latest news about Windows, Office, Azure, Skype, HoloLens and all the rest of their products.

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