Three cryptocurrency investors filed a federal lawsuit against Apple (Nasdaq: AAPL) on July 24. They allege they lost a combined $1.8 million in Bitcoin through a fake wallet app listed on th
Three cryptocurrency investors filed a federal lawsuit against Apple (Nasdaq: AAPL) on July 24. They allege they lost a combined $1.8 million in Bitcoin through a fake wallet app listed on the App Store.
The complaint was filed in the U.S. District Court for the Northern District of California. It accuses Apple of failing to adequately review and monitor apps distributed through its platform.
Apple recently overtook Nvidia to become the world’s largest public company by market capitalization. Its valuation stood at about $4.989 trillion at the time of writing.
Related: Cheaper Amazon cloud rival files for Chapter 11 bankruptcy
The plaintiffs said they trusted the fake app because Apple markets the App Store as:
“A safe and trusted place to discover and download apps.”
The app impersonated Sparrow Wallet, a Bitcoin wallet available on Windows, macOS and Linux. Sparrow does not offer an iOS app.
Users were allegedly asked to enter their 12- or 24-word recovery phrases. A recovery phrase acts as the master key to a crypto wallet. Anyone who obtains it can control the assets inside.
The lawsuit alleges the fake app sent those phrases to the scammers. The attackers then transferred the victims’ Bitcoin to wallets they controlled.
James Ramirez, Christopher Ellis and Jalen Delgado allegedly lost about $875,000, $840,000 and $120,000, respectively. The thefts occurred between May and August 2025.
The lawsuit alleges Apple violated California's Consumers Legal Remedies Act and other consumer protection laws by failing to adequately review and monitor apps on the App Store.
"This fraud succeeded precisely because Apple exploited the consumer trust it had deliberately cultivated through more than a decade of marketing the App Store as a uniquely safe and trusted environment," the complaint states.
The suit also alleges Apple failed to act even after users reported the fraudulent apps.
Sparrow Wallet developer Craig Raw has publicly warned about fake versions since at least January 2024, writing on X that "there is still a scam 'Sparrow Wallet' app on the @Apple App Store, despite myself and others having reported it weeks ago."
In June, Raw said Apple briefly flagged his developer account for termination after he submitted a placeholder app intended to warn users that Sparrow Wallet is desktop-only. Apple later reversed the decision.
Apple said on July 27 that it had removed apps impersonating Sparrow Wallet and terminated the associated developer accounts.
The lawsuit comes amid another costly year for crypto users and protocols.
DefiLlama data shows hacks drained about $1.07 billion from crypto projects between January and July 2026.
April recorded the largest monthly loss at $644.85 million. July followed with $118.79 million, while January accounted for $101.57 million.
Source: DefiLlamaThe figures cover protocol hacks and exploits. They do not measure all consumer scams, including fake wallet apps and social engineering attacks.
The Apple lawsuit seeks damages for the Bitcoin allegedly stolen. It also asks the court to require stronger App Store screening and fraud warnings.
