Apple kept fake Sparrow Wallet app on App Store after $875K theft report
In brief
- Apple allegedly allowed a fake Sparrow Wallet app to remain on its App Store for over a week after a theft report
- Three users collectively lost $1.84 million after downloading the fraudulent bitcoin wallet app
- Lawsuit seeks reimbursement, damages, and demands Apple strengthen app review controls
The theft timeline
James Ramirez downloaded the fraudulent app on July 25, 2025 and had 7.4 BTC transferred to a scammer. He reported the app and theft to Apple that same day. Ramirez and Ellis said Apple never responded to their reports.
Nine days later, Christopher Ellis lost about $840,000 after installing the fraudulent app on Aug. 3. A third victim, Jalen Delgado, had downloaded the app around May 1, 2025 and lost 1.05 BTC, then worth roughly $120,000.
The impersonation worked because the official Sparrow Wallet is a desktop-only application available for Windows, macOS and Linux and does not offer an iOS version. Yet the fake app appeared on Apple's store, potentially confusing users into thinking an official iOS wallet existed.
Apple's alleged negligence
The lawsuit alleges Apple ranked the fraudulent application and included it in curated cryptocurrency app collections alongside legitimate products. This wasn't the first warning sign. Sparrow developer Craig Raw warned in January 2024 that an impersonator remained available despite being reported to Apple weeks earlier.
The plaintiffs brought eight claims covering consumer-protection laws, fraudulent and negligent misrepresentation and failure to warn. They're seeking reimbursement of the stolen assets, compensatory and punitive damages, and potentially multiplied damages. They also want Apple to disclose the limitations of its review process, strengthen its controls, and warn users that an App Store listing doesn't establish that a cryptocurrency application is authentic.
Apple's prior liability shield
This isn't Apple's first rodeo with fake wallet litigation. In 2021, cryptocurrency holders sued Apple over a "fake" wallet app scam in a case that was dismissed. At that time, a federal judge agreed with Apple that it couldn't be held liable for the app because it was considered the publisher of the content, not its creator.
That precedent may not hold here. The new suit hinges on Apple's conduct after being notified—a factual distinction that could change how courts view the company's responsibilities.
Apple's response
Apple told MacRumors it has taken action to remove any apps impersonating Sparrow Wallet on the App Store and to terminate developer accounts associated with those apps. The company also pointed to its enforcement record: it previously terminated 193,000 developer accounts over fraud and rejected more than 371,000 copycat, spam, or misleading submissions last year. The company stopped over $2.2 billion in potentially fraudulent transactions.
Those numbers don't address the core allegation: that Apple's response to a specific, detailed report of theft was silence.
