Three plaintiffs say Apple's App Store review failed to catch a fraudulent Sparrow Wallet that stole $1.8M in Bitcoin. The case follows a $9.5M Ledger Live scam on the Mac App Store.
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Three cryptocurrency users sued Apple in California federal court on July 24–25, alleging the company's App Store review process failed to stop a fake Bitcoin wallet app that drained $1.8 million from their accounts.
The fraudulent app impersonated Sparrow Wallet, a desktop-only Bitcoin wallet that has no iOS version. The plaintiffs said they downloaded “Sparrow Wallet” from the App Store between May and August 2025. Once they imported wallet data or created new wallets, the app redirected their funds to scammers' addresses, according to the complaint.
Plaintiff Eric M. lost $875,000, plaintiff David G. lost $840,000, and plaintiff Lisa T. lost $120,000, the lawsuit states. The app mimicked the real Sparrow Wallet's interface and branding closely enough that users believed they were using legitimate software.
Craig Raw, who developed the authentic Sparrow Wallet, said he has reported numerous impersonator apps to Apple since 2020. His warnings did not prevent the fake app from remaining on the store for months, according to the lawsuit, which cites Raw's public statements.
The case is the second major crypto wallet scam on Apple's platforms in recent months. In April 2026, a counterfeit version of Ledger Live appeared on the Mac App Store. It stole over $9.5 million from more than 50 victims, according to a separate lawsuit filed in the same district.
Apple removed the fake Sparrow apps after they were flagged and terminated the associated developer accounts, the company said. It pointed to its 2025 fraud prevention report, which showed 193,000 developer accounts were shut down and $2.2 billion in potentially fraudulent transactions blocked.
The plaintiffs argue that Apple's marketing of App Store safety amounts to false advertising when scam apps can operate for months without detection. The company has long promoted its review process as a safeguard against malicious software, the lawsuit notes. Apple's app review guidelines state that apps must not impersonate other apps or copy their functionality. The plaintiffs say Apple failed to enforce those rules.
The complaint, filed in the U.S. District Court for the Northern District of California, accuses Apple of negligence and false advertising. A copy of the complaint was not immediately available. Apple did not respond to a request for comment beyond its public statements about fraud prevention.
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