Warning over rise in scam Ethereum Android app

A fake Android app which scams users into purchasing fake Ethereum coins has been circulating on the Google Play Store, cryptocurrency media outlets are reporting.

Google has now acted to remove the app, which is believed by some to have defrauded users out of almost $400,000.

Prior to its removal, users who saw the app were told that they could purchase it and receive one Ethereum (ETH) token in return for a fee.

The price of the app, however, was $388. ETH is not currently valued at anywhere near that and is in fact at well under $300.

However, even with the premium included this was still an attractive proposition for many users – as it meant they did not need to go through the often convoluted channels of purchasing an actual Ethereum token.

Once the app was downloaded from the Play Store and the money had changed hands, users discovered that they had in fact simply downloaded an image of a token.

According to industry news websites, the app was present on the Play Store for more than twelve months before it was removed.

Under the rules of the Play Store, those who create apps and post them in the store are required to send some of their revenue to Google, the Play Store owner. In theory, this means that the multinational tech giant may also have benefitted from the scam.

The incident illustrates the sophisticated nature of many cryptocurrency scams. In this case, the app appeared for all intents and purposes to be a fully legitimate download, with a developer called Google Commerce Ltd, although this firm had no connection to Google itself.

Although this particular app only had one hundred or so downloads before Google acted to remove it from the Play Store. At a price of $388, this means that whoever was behind it could have pocketed $38,800 in total before costs.

However, it was just one of many app-based scams which users around the world have fallen victim to.

In 2017, Google acted to take down more than 70,000 apps from the Play Store on the grounds that they did not seem to be legitimate.

That represented a rise of around 70% compared to the number they got rid of in 2016, indicating either that the scale of the problem is getting larger with each passing year, or that Google is simply getting better at tackling it.

Cryptocurrency apps which create false illusions for consumers have also affected other areas of the app market as well.

At the end of last year, it was revealed that an app which imitated a popular Bitcoin wallet was available for download.

MyEtherWallet, which is a legitimate provider, had its name stolen by an app developer who then began offering services on the iOS App Store for $4.99 per download.

The legitimate MyEtherWallet responded strongly at the time, tweeting: “This is NOT US. We have file [sic] reports and emailed and reported. Would appreciate the communities [sp] assistance in getting these scamtards out of our lives.”

About the author: Karen Miller

Karen is probably our staunchest champion of combating foreign exchange fraud, with interests in every related area. She is one of our most regular contributors and no scam is too big or too small for Karen’s attention. She works tirelessly in her personal and professional life to shine light on the individuals responsible for fraud, rather than just trying to avoid the schemes themselves. Karen is an avid follower of new government measures to combat fraud and has a comprehensive network of contacts within the field. Karen has a background in banking, corporate and finance law, having attended the Fordham University School of Law in New York. She still lives in New York and has worked for some of the biggest and most recognisable names in the sector, gaining a wealth of expertise and experience over the years. Karen admits to not having a huge amount of spare time, and much of the time she does have is spent reading and posting on sites dedicated to exposing scams of all kinds, not just forex fraud. Perhaps unsurprisingly, she spends what little downtime she has reading and watching crime thrillers and biographies with her French Bulldog Columbo.

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