The smartphone app scam

If you enjoy playing games on your mobile, be on the look-out for malicious Apps and the increasingly sneaky tricks that scammers use to part you from your cash.

Would you spend £80 on an app? Probably not. At least, not willingly! But this is exactly what has happened to some game-playing Smartphone enthusiasts. 

Whilst many think Smartphones are a waste of money, and are more than happy with their low-tech but highly effective mobile phone, there is no doubting their immense popularity. Apple sold 37.04 million iPhones in the first fiscal quarter of 2012. According to some bright spark with a calculator, this means there are more iPhones sold each day than there are babies born. 

The cost of owning a Smartphone 

There are obvious savings you will make if you don’t invest in a Smartphone – such as the cost of the handset (you could pay as much as £664 for a high end iPhone 4S 64GB handset on Amazon). There are also less obvious ways that such a phone can eat into your cash supplies. There are many added extras you can get on your Smartphone, such as buying music and games to play on-the-go, but all these little luxuries add up. 

The popularity of apps 

Apps, pieces of software that can run on your computer or Smartphone, are big business. Designing a successful app can earn you a packet, especially if you are the creator of one of the most popular games, like Angry Birds. Millions of these games are downloaded each year, and scammers have taken full advantage of the opportunity to exploit the customers who buy them. 

Scams and cheats 

A recent case in the news concerns the popular app games of Angry Birds, Cut the Rope and Assassin’s Creed. A company created malicious apps that looked precisely like the genuine games and put them up for sale for the Android market on the Google Play App Store. Users who thought they were downloading the genuine games were unwittingly downloading fakes. 

Google has made it clear that they don’t screen apps submitted to their site, so it is a case of caveat emptor! The fake apps did not make it onto the Apple iTunes site, so only Android users were affected. However, there are plenty of scams aimed at the iPhone market too, so Apple customers should not be tricked into thinking they are safe! 

The cost of a scam 

Unfortunately it was not just a question of sacrificing the cost of the game – around 69p in the case of many apps. When the malicious apps were downloaded they opened the Smartphone up to a Trojan attack. Trojan attacks disguise themselves as legitimate programs, but are designed to inflict harm or damage to your device. This particular Trojan attack accessed the phone’s data and sent a total of 3 premium rate text messages to the user. 

These text messages were sent each time the app was accessed, costing a hefty £15 each! The malware concealed the sent and received text messages so that users did not even know they had been charged! Many tried to access their downloaded app a number of times before realising all was not as it should be. Users were not aware of the charges until their bill arrived. 

Reports suggest that the most any individual actually lost was £80, but an investigation by government watchdog PhonePayPlus revealed that the total amount collectively lost by those scammed was around £28,000! They also identified that the app was live in 18 other countries, potentially increasing those figures dramatically. 

Not bad for the scammers! Or so they thought. 

Action 

Phonepayplus received complaints from a number of UK customers and swung into action. The company, A1 Agregator Limited who have registered offices in the UK, were fined £50,000. Thanks to the swift action taken, the money paid by customers was intercepted and not passed on to the fraudulent app developers.  In this case everyone who lost money was given a full refund, but many are not so lucky. 

Protect yourself 

To protect yourself against dodgy apps in the future pay attention to the permissions an app requests when you are installing it. If it asks for permission to send and receive texts then think twice! Also, look at protecting your device with mobile anti-virus software, like this from Norton. 

How to complain 

If you have been caught out by a trick like this, don’t just chalk it up to experience. If you complain to the right people, you are in with a chance of getting your money back and – more importantly – getting companies like the one above caught and fined. 

Government bodies like Phonepayplus will only take action when they receive a significant number of complaints. The reasoning behind this is that if no one is complaining the problem can’t be that big, and it will be a waste of tax payers’ money to investigate. 

So, the more complaints the better! Contact Phonepayplus, previously called ICSTIS, who regulate premium rate numbers and services in the UK. 

More: How your Smartphone can save you money, The MoneyTrack iPhone app has been submitted, Sneakiest Phone Scams