July 7, 2015

07 July 2015

Joint FTC and NJ AG Complaint and Settlement Against App Developer that Allegedly “Hijacked” and “Drained” Phone Resources

On June 29, the FTC and New Jersey Attorney General announced the filing of a joint complaint, and proposed, stipulated settlement, against an Ohio-based app developer, Equiliv Investments LLC and an individual officer of the company. The federal and state enforcement agencies alleged that Equiliv marketed a free app that users believed would let them earn rewards points for playing games or downloading affiliated apps.  The agencies alleged that Equiliv explicitly represented the app was free of malware when in fact the app’s main purpose was actually to load malicious software on the users’ phone to mine virtual currency.  Allegedly, the app took control of the devices’ computing resources and degraded the phones’ performance by draining battery life and data plans, and causing the devices to charge slowly.  The malware was alleged to pool the computing resources of consumers’ mobile devices to benefit the company’s effort to generate virtual currencies through a peer-to-peer network to compete with other devices in solving complex mathematical equations – a process known as “mining.”


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