This is one of the first problems we encountered aswell. To prevent what we call "GPS Spoofing" we use a system called a-GPS where a users location is verified using cell towers and GPRS nearby. If we happened to know the general location of cell towers, we can check to see if the current cell tower matches the location given (within an error margin of something large, like 10 or more miles). For example, if our app unlocks checkcoins if the user is in a specific location (your store, for example), we could check GPS, GPRS as well as cell towers. Currently, no GPS spoofing app also spoofs the cell towers, so we could easily see if someone across the country is simply trying to spoof their way into a checkpoint.