VIDEO: Fake apps fool smartphone users, newest form of ID theft

on-nightly-fake-apps — Click to watch me discuss this with NBC’s Tom Costello.

Here’s a new kind of ID theft you have to worry about: App ID Theft.

Retail apps are cool again, but be careful what you click on. The New York Post revealed recently that Apple’s App Store is getting crowded with fake impostor apps. They appear to be legitimate retail store apps — in some cases, they fill a void left by retailers that don’t have apps — but when users install them, the criminals can steal victims’ personal information. The New York Times expanded nicely on the report this week, even talking to a firm that makes impostor software.

How could this be happening? Apple has always been good about keeping malware out of the App Store. Well, that’s the trick. These apps aren’t malware. They don’t have malicious code. They simply aren’t what they say they are.

Here is one reason this is happening now: for the most part, consumers had rejected store-specific apps for the past decade or so, because they provided no real value. That is changing…fast. Apps have become gift cards with benefits, and people now love them. The difference is called “digital stored value.” Starbucks has led the way in getting consumers to use apps like debit/credit cards.

Starbucks’ wild success with its app has other retailers jealous, and in full-blown imitation mode. Why? Starbucks is now essentially a bank, sitting on more than $1 billion in a free loan. Folks are racing to copy them. Dunkin Donuts was first, then CVS, and now McDonald’s, for example.

Here’s a story about that:

https://bobsullivan.net/gotchas/millennials-buying-gift-cards-for-themselves-as-retailers-race-to-mimic-starbucks-digital-dollars-success/

Why does that matter for this App ID Theft? Folks are finally filling their phones with retailer apps, creating an opening for these fake apps. Also, they are willingly loading credit cards into these apps, which really opens the door for the fraudsters.

RED TAPE WRESTLING TIPS

So what’s the best advice for consumers? Apps with few reviews or bad reviews should be a tipoff. But honestly, criminals will figure out that tip-off soon. You’ll have a hard time distinguishing between impostors and the real thing. So it makes sense to be very judicious about apps you put on your phone. Use links from a firm’s website to download apps. And give as little information as possible when using an app. (You probably know how I feel about linking your credit card to Starbucks’ app).

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