Last October, California-based Jacob Perlman downloaded an Android version of a cryptocurrency wallet app called Phantom from the Google Play Store.
It was four months Before San Francisco-based Phantom Technologies has released an Android version of its digital wallet. The free Phantom Wallet app that Pearlman initially downloaded from Google Play was a fake. And when he linked his real Phantom wallet to the app, it cost him a small fortune.
Less than 24 hours after downloading the fake “Phantom Wallet” app from Google Play, Pearlman’s real Phantom Wallet was emptied with over $800,000 in virtual currencies, including SAMO, USDC, ORCA and SOL, as well as four NFTs additional”. Lawyers say in a lawsuit seeking to recover stolen funds from Google instead of the fake app launcher.
complaint [PDF]in a higher court in Santa Clara County, seeking to hold Google liable for breach of its warranty regarding its security practices and terms of service.
However, the court record also indicates that Phantom October 11, 2021 Issue a general warning that the Google Store displays low-quality products. At the time, the real Phantom introduced its crypto wallet as an extension for Chrome, Brave, Firefox, and Edge. Today, it offers iOS and Android versions along with browser add-ons.
“Phantom is not available on iOS or Android,” the company tweeted last year. “Using a fake Phantom mobile app will steal your money. Help us by reporting these apps when you see them in the app stores.”
Users responded to this warning with regrets that they had been scammed, and the next day Phantom said, “We removed eight different apps this week alone. We can only remove them as quickly as Google responds to removal requests.”
However, it appears that Google has not been able to keep the fake crypto-stealing apps out of Google Play.
“Despite Phantom’s efforts to block fake Android apps from the Google Play Store, and despite Google’s stark warning that it was offering fraudulent ‘Phantom Wallet’ apps for download, a few days later, on October 21, 2021, Pearlman was able to download and do them,” said Pearlman’s complaint.
The court filing says that by offering the apps through Google Play, The Chocolate Factory represents those apps as safe and warrants through its terms of service that it moderates its services with reasonable care.
According to the complaint, “Google violated its own warranty and terms of service by submitting a fraudulent app, failed to warn Pearlman that the app might be dangerous, and failed to prevent Pearlman from downloading the app.”
In response to a request for comment, Google did not immediately respond.
Google asked for more time to respond, and the judge decided the case was complex and required more time. A case management conference is scheduled for next week.
If Perelman is able to recover $800,000 from Google, the lawsuit appears to be a better investment than the stolen cryptocurrency mix, so far. Since Oct 21, 2021: SOL is down nearly 80% from $196.43; ORCA price is down about 92% from $12.42; SAMO is down almost 55% from its $0.029 price tag. And the USDC, which is pegged to the dollar, is still more or less the same.
If Phantom sounds familiar, it’s because it fell into a slop wallet attack this week in which millions of dollars in cryptocurrency were stolen from nearly 8,000 wallets. ®