Three iPhone owners sued Apple last week over a fake Sparrow Wallet app they say they downloaded from the App Store. The plaintiffs say using the bogus app led to the theft of their Bitcoin, resulting in losses of roughly $1.8 million.
The lawsuit, Ramirez et al v. Apple, Inc., accuses Cupertino of failing to catch the scam app despite years of marketing the App Store as a safe place to download software.
How the fake Sparrow Wallet app stole Bitcoin
Apple has spent nearly two decades convincing iPhone owners of the App Store’s security, but that promise is now at the center of a lawsuit alleging that the company’s review process failed miserably. The case underscores a growing problem for Apple: As scams become more sophisticated — and financial losses more devastating — the company’s tightly controlled app ecosystem faces scrutiny not just over how many malicious apps it blocks, but by the few that slip through.
According to the complaint, filed Friday in the U.S. Court of Appeals for the 9th Circuit, a fraudulent Sparrow Wallet app found its way to the App Store, mimicking the real thing closely enough to fool experienced crypto users. The real Sparrow Wallet is a desktop app for Windows, macOS and Linux, but it has never been available on iOS.
Plaintiffs James Ramirez, Christopher Ellis and Jalen Delgado say they downloaded the malicious iOS app between May and August 2025. Once installed, the fake Sparrow Wallet app asked them to enter their wallet’s seed phrase — the string of words used to recover a crypto wallet.
And that’s exactly what the developers of the copycat Sparrow Wallet app wanted. When users entered their seed phrase, the scammers gained full control of the funds inside the plaintiffs’ accounts.
Delgado says he downloaded the app around May 1, 2025, and soon after lost about 1.05 Bitcoin, worth roughly $120,000 at the time.
Ramirez and Ellis say they downloaded the fake app last year on July 25 and August 3, respectively. Ramirez lost 7.4 Bitcoin, valued at around $875,000. Ellis lost close to $840,000 worth of crypto. Both say they reported the situation to Apple right away.
Apple was warned years prior
The lawsuit claims Apple had been previously warned about fake Sparrow Wallet apps. The warning came in early 2024 from Craig Raw, the developer of the real Sparrow Wallet.
“There is still a scam ‘Sparrow Wallet’ app on the @Apple App Store, despite myself and others having reported it weeks ago,” Raw said in an X post on January 6, 2024. “Worse, you have to install it to report it. Always go to the wallet’s website to find the link to download it. App stores will not protect you.”
In a recent post, the developer said he continued to push Apple to address the fake apps.
“Since 2023, more than a dozen fake ‘Sparrow’ apps have appeared on the App Store, as recently as April this year,” Raw wrote in an X post on June 22, 2026. “Users have contacted me after losing their savings, in some cases their life savings, to these impersonators.”
Raw even submitted his own placeholder app designed to warn users that any Sparrow Wallet app on iOS is fake. Apple initially flagged his developer account for the submission before reversing course.
The complaint also alleges that Apple ranked the fake app in search results and featured it in curated crypto collections.
Fake Sparrow Wallet app is not the first crypto app to slip onto App Store
This isn’t Apple’s first brush with fake crypto apps on the App Store. It’s merely the latest incident in a string of crypto wallet scams that have slipped past Apple’s review process. Back in 2023, a fake Trezor wallet app climbed the charts before Apple pulled the plug. A fraudulent Rabby Wallet app appeared in 2024.
Earlier this year, a fake Ledger Live app reportedly facilitated the theft of more than $9.5 million from more than 50 victims. And last year, another lawsuit accused Apple over a fake trading app called Swiftcrypt.
The plaintiffs in the Sparrow Wallet case are suing Apple under consumer-protection laws that cover California, Louisiana and Massachusetts. The plaintiffs also bring claims of fraudulent and negligent misrepresentations, in addition to accusing Apple of failing to warn users about fake crypto apps.
They asked a jury to award damages, reimburse their stolen Bitcoin, and force Apple to strengthen its App Store review process.
Apple’s response to crypto scams
Apple pushed back on the claims, saying it quickly removed apps impersonating Sparrow Wallet. It also terminated the developer accounts behind the fake apps.
While Apple declined to comment on Ramirez et al v. Apple, Inc. specifically, the company told TechCrunch that no Sparrow Wallet copycats are currently listed on the App Store. Apple also pointed to its own data from 2025, which showed it rejected more than 371,000 app submissions. The company says it rejected these submissions for copying other apps, spamming users or attempting to mislead potential downloaders.
The fake Sparrow Wallet case is still in its early stages, and Apple has yet to file a formal response in court.
Anurag Chawake is a tech-focused writer specializing in smartphones, apps and consumer technology. His interest in computers began during the Windows 98 era, eventually leading him to explore everything from operating systems to mobile devices and PC hardware. Anurag previously contributed to The Indian Express, covering Apple, Android, gaming and the broader technology landscape.
