$14 000 USD

DECEMBER 2020

GLOBAL

TREZOR

DESCRIPTION OF EVENTS

"The safe place for your coins." "Store your coins with Trezor." "Hardware wallet is the safest way to manage & trade your cryptocurrencies."

 

"Apple touts its store as “the world’s most trusted marketplace for apps.” Speaking to the Washington Post, a spokesperson for Apple explained that all apps undergo a rigorous review process—but acknowledged that there have been other cryptocurrency scams on the App Store." "Apple bills its App Store as “the world’s most trusted marketplace for apps,” where every submission is scanned and reviewed, ensuring they are safe, secure, useful and unique."

 

“User trust is at the foundation of why we created the App Store, and we have only deepened that commitment in the years since,” said Apple spokesperson Fred Sainz. “Study after study has shown that the App Store is the most secure app marketplace in the world, and we are constantly at work to maintain that standard and to further strengthen the App Store’s protections. In the limited instances when criminals defraud our users, we take swift action against these actors as well as to prevent similar violations in the future.”

 

"James Fajcz, a reliability engineer at a paper company, lives in Savannah, Ga." "In December, as he saw prices of the digital tokens rising, he purchased about $14,000 worth of Ethereum and bitcoin on Coinbase and Binance with money from his savings."

 

"He wanted to make sure his investment was secure, so he purchased a Trezor Model T hardware wallet and downloaded an app on his iPhone called Trezor, which asked for his seed phrase. The app didn’t connect to his Trezor wallet, and he figured it didn’t work." "Although Trezor does not currently support Apple's iOS mobile operating system and does not have a mobile app, [an] app used the company's name and branding, and had a user rating of nearly five stars—making it appear trustworthy."

 

"Trezor — which manufactures very-secure hardware wallets — doesn’t actually have an app, so when the holder entered the seed recovery phrase for his wallet, he was unwittingly handing the keys to his bitcoin over to the peddlers of a fake application." "Fajcz were duped by an app pretending to belong to @Trezor, which says it's been trying to get Apple and Google to stop these apps "for years.""

 

"Weeks later, he purchased more Ethereum on Coinbase. He plugged in his Trezor device, but nothing was there. He went on the Trezor support forum on Reddit for answers. A Reddit poster informed him: There is no Trezor app." “My jaw dropped to the floor. My heart sank,” he said. “I realized what I did.”

 

"Fajcz said he called Apple’s support line. An Apple representative said the company was not responsible, Fajcz says." “This was a trusted app on the App Store claiming to be the best and most trusted app store on any system anywhere,” he said. “And this nefarious app gets on the platform? I feel Apple should be held partially or fully responsible for that.”

 

"[I]n fact, it’s easy for scammers to circumvent Apple’s rules, according to experts. Criminal app developers can break Apple’s rules by submitting seemingly innocuous apps for approval and then transforming them into phishing apps that trick people into giving up their information, according to Apple. When Apple finds out, it removes the apps and bans the developers, the company says. But it’s too late for the people who fell for the scam."

 

"James Fajcz lost $14,000 worth of Bitcoin and Ethereum to the fake app."

 

"Apple agreed that there have been other crypto scams on the App Store previously but would not say how many. The iPhone maker did not comment on whether fake Trezor apps have sneaked into the App Store in the past, or whether new apps going by the name ‘Trezor’ will get flagged as possibly fraudulent in the future."

 

"The fake Trezor application appears to have got through the app store via a bait-and-switch, according to Apple. Although it was known as Trezor and used the Trezor logo and color themes, it presented itself as a “cryptography” app. It was designed to encrypt iPhone files and store passwords, as explained by Apple."

 

"Developers of the fake app told reviewers that it “is not involved in any cryptocurrency.” Apple approved this app and it went live in the App Store on January 22, based on mobile analytics firm Sensor Tower."

 

"This Trezor cryptography app sometime later changed itself into a crypto wallet. Apple prohibits such changes but it does not know when they occur. It mainly relies on clients and users to report it when such incidents happen."

 

"Apple avoided naming the developer of the fake Trezor app or offer the developer’s contact details. the company also did not say whether it was turning over the name to law enforcement or whether it managed to investigate the developer further. Moreover, Apple did not say whether the developer had developed any other apps in the past or had any connections to other developer accounts under pseudo names."

 

"A UK-based firm that specializes in crypto regulations and conducts many fraud investigations, Coinfirm, said that it has got at least 7,000 inquiries about stolen crypto assets since October 2019. The company’s chief information officer, Pawel Aleksander, said that fake apps in Apple’s App Store and Google’s Android Play Store are common." "@Coinfirm_io investigates these things. They found people lost $1.6 million to the iOS scam alone."

Trezor did now have any IPhone version of their application. A scammer created a fake IPhone Trezor application. This was downloaded and requested the sensistive information, presumably the seed phrase. Once provided, all balances on the wallet were stolen. The app has since been removed. It is unclear if any funds were recovered.

HOW COULD THIS HAVE BEEN PREVENTED?

There is no reason to ever enter a seed phrase into an application. All hardware wallets on the market establish that any phrase should be entered into the hardware wallet hardware itself.

 

Always check and visit the official website of a service. The majority of funds should be stored offline and not on a live wallet application. When setting up a new wallet or upgrading wallet software, never enter your pass phrase or send any funds without first transferring a smaller amount.

 

Check Our Framework For Safe Secure Exchange Platforms

Sources And Further Reading

 For questions or enquiries, email info@quadrigainitiative.com.

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