FTC, NJ AG Settle Allegations App Developer Hijacked Consumers’ Phones to Mine Cryptocurrency
Developers for the smartphone app Prized agreed to settle allegations with the FTC and New Jersey attorney general Monday. The agency and AG alleged the app makers violated the FTC Act and the New Jersey Consumer Fraud Act by luring…
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
consumers into downloading the “rewards” app because it was free of malware, “when the app’s main purpose was actually to load the consumers’ mobile phones with malicious software to mine virtual currencies for the developer,” said a commission news release. Defendants Equiliv Investments and CEO Ryan Ramminger are permanently banned from creating and distributing malicious software, it said. The settlement also includes a $50,000 judgment payable to New Jersey, it said. “Hijacking consumers’ mobile devices with malware to mine virtual currency isn’t just deplorable; it’s also illegal,” said FTC Consumer Protection Bureau Director Jessica Rich. The Prized app became available in February 2014 in the Amazon App Store, Google Play Store and others, the release said. “Thousands of consumers downloaded the app believing they could earn points for playing games or downloading affiliated apps and then spend those points on rewards such as clothes, gift cards and other items,” it said. “What consumers got instead, according to the complaint, was an app that contained malware that took control of the device’s computing resources to ‘mine’ for virtual currencies" like Dogecoin, Litecoin and QuarkCoin, it said. “Virtual currencies are created by solving complex mathematical equations, and the complaint alleges that the app attempted to harness the power of many users’ devices to solve the equations more quickly, thus generating virtual currency for the defendants,” the release said. “Consumers downloaded this app thinking that at the very worst it would not be as useful or entertaining as advertised,” said Acting New Jersey Attorney General John Hoffman. “Instead, the app allegedly turned out to be a Trojan horse for intrusive, invasive malware that was potentially damaging to expensive smartphones and other mobile devices.” Equiliv and Ramminger couldn't be reached for comment. To avoid downloading malware on a phone, FTC Consumer Education Specialist Nicole Fleming recommended in a blog post Monday reading app reviews, researching a developer and reviewing permission an app requires. “If your phone seems to be running slowly, heating up, or losing battery power quickly, check your settings to see which apps are using your data and battery power,” Fleming said. “If you have apps that are using unreasonable amounts of data and power, consider removing them.”