{"id":78148,"date":"2023-05-02T12:35:41","date_gmt":"2023-05-02T09:35:41","guid":{"rendered":"https:\/\/forklog.com\/en\/?p=78148"},"modified":"2025-09-11T03:20:43","modified_gmt":"2025-09-11T00:20:43","slug":"coinbase-accused-of-violating-laws-over-kyc-procedures","status":"publish","type":"post","link":"https:\/\/u1f987.com\/en\/coinbase-accused-of-violating-laws-over-kyc-procedures\/","title":{"rendered":"Coinbase accused of violating laws over KYC procedures"},"content":{"rendered":"<p>Coinbase user Michael Massel <a href=\"https:\/\/www.courtlistener.com\/docket\/67306707\/1\/massel-v-coinbase-inc\/\">filed a lawsuit<\/a> against the company, stating that the exchange&#8217;s <span data-descr=\"Know Your Customer \u2014 'know your customer'\" class=\"old_tooltip\">KYC<\/span> procedures violate U.S. law.<\/p>\n<p>The plaintiff argues that the platform violated the Illinois Biometric Information Privacy Act (BIPA), which requires advance consent for the collection of data.<\/p>\n<p>Coinbase, like other centralized exchanges, asks users to scan a government-issued ID and a selfie to complete KYC. The company then uses this information to create a biometric facial template, which is used to verify documents.<\/p>\n<p>Massel asserts that this approach puts citizens&#8217; personal data at risk in the event of a breach. He also insists that Coinbase destroy users&#8217; biometric data immediately after a successful verification.<\/p>\n<p>According to the suit, the exchange did not have a publicly available policy setting retention periods and guidelines for the irreversible destruction of such information.<\/p>\n<p>The disgruntled plaintiff also sought damages from the company of $5,000 for intentional violation of BIPA or $1,000 for unintentional conduct.<\/p>\n<p>As reported on March 23, the U.S. Securities and Exchange Commission (SEC) <a href=\"https:\/\/u1f987.com\/en\/news\/sec-issues-wells-notice-to-coinbase\">sent a notice<\/a> to the exchange regarding an investigation into the listing procedures on the platform and its products \u2014 Coinbase Prime, Coinbase Wallet and <a href=\"https:\/\/u1f987.com\/en\/news\/what-is-staking-and-how-to-make-money-from-it\">staking<\/a> service Coinbase Earn.<\/p>\n<p>In April, the company <a href=\"https:\/\/u1f987.com\/en\/news\/coinbase-responds-to-sec-allegations-warns-of-reputational-risk\">responded<\/a> to the SEC&#8217;s allegations, stating it was prepared to &#8216;vigorously defend&#8217; itself. Representatives of the exchange also noted that the regulator could suffer reputational damage from the proceedings.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A Coinbase user Michael Massel filed a lawsuit against the company, claiming that the exchange&#8217;s KYC procedures violate U.S. law.<\/p>\n","protected":false},"author":1,"featured_media":78149,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"select":"1","news_style_id":"1","cryptorium_level":"","_short_excerpt_text":"","creation_source":"","_metatest_mainpost_news_update":false,"footnotes":""},"categories":[3],"tags":[1292,138,1162],"class_list":["post-78148","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-and-analysis","tag-aml-kyc","tag-coinbase","tag-court-cases"],"aioseo_notices":[],"amp_enabled":true,"views":"26","promo_type":"1","layout_type":"1","short_excerpt":"","is_update":"","_links":{"self":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/78148","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/comments?post=78148"}],"version-history":[{"count":1,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/78148\/revisions"}],"predecessor-version":[{"id":78150,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/78148\/revisions\/78150"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media\/78149"}],"wp:attachment":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media?parent=78148"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/categories?post=78148"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/tags?post=78148"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}