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Cryptocurrency firm sues YouTube for letting its CEO impersonated by scammers


Cryptocurrency firm Ripple sues YouTube for its “inexplainable inability” to deter scammers from impersonating their CEO. Ripple accused the video site in a lawsuit lodged today of selling advertisements and checking profiles advertising fraudulent cryptocurrency promotions, instead of ignoring questions about them.

Ripple runs the digital currency trading network XRP, which is targeted at individuals who want to transfer money abroad. Scammers have built official-sounding profiles for Ripple and its CEO, Brad Garlinghouse, over the past few months.

Apparently some of the profiles were taken from famous YouTubers who had compromised their profiles giving the scammers hundreds of thousands of subscribers. From there, videos promising massive XRP bonuses could be uploaded in return for smaller initial fees, bilking viewers who believed they were watching Ripple’s web.

One fake account made headlines last month, and Ripple dates the problem to last year’s November at least, saying about 350 impersonation or scamming complaints have been submitted. But it says there are plenty of them that YouTube “disregarded or otherwise failed to answer.”

youtube, cryptocurrency

In one instance it apparently gave an official verification badge to a hacked site. And Ripple alleges that YouTube continued to allow paid ads related to it even after being warned of the scam. The result was a “attack” of messages from individuals who believed that Ripple had stolen their money or hacked their accounts. It’s not clear how much money the scammers paid, but one account apparently won XRP worth $15,000.

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Cryptocurrency scams on wide web platforms have been a longstanding issue. In 2018, Martin Lewis, a UK financial journalist, sued Facebook for defamation after accepting advertisements that linked his name to getting-rich-quick schemes. Last year Facebook settled the suit with a donation to an effort to combat scams.

For ignoring complaints and refusing to accept money for the scammy advertisements, Ripple accuses YouTube of contributory trademark infringement among other items. Section 230 of the Communications Decency Act explicitly protects websites from liability for third party material, even though the website supports or encourages such material.

(While Ripple could locate and prosecute people violating its trademark, that’s far from a straightforward task.) But there’s an exception to this rule for certain intellectual property cases, which — in combination with the argument that YouTube is taking money for Ripple impersonating ads — might complicate that case.

Ripple claims it’s filing the suit to “prompt a wide-ranging shift in business conduct and set the standard of transparency.” And it’s likely that the company will call it a victory if it merely advertises the scam issue on YouTube — even though there’s no legal censure involved.

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A YouTube spokeswoman said in a statement to The Verge that “we take our platform abuse seriously and take decisive action when we find breaches of our rules, such as fraud or impersonation.”

Ayeni Sylvester
the authorAyeni Sylvester

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