Legal Woes: Coinbase Faces New Class Action, IRS Allowed to Investigate SFOX' Customers, Another Objection in SEC-Ripple War
Major crypto exchange Coinbase faces a new class action suit alleging the company unauthorizedly transfers and freezes funds and locks consumers out of their accounts for extended periods. Meanwhile, the US Internal Revenue Service (IRS) has been granted permission to look into the customers of crypto prime dealer SFOX Inc., while the US Securities and Exchange Commission (SEC) objected to orders to disclose drafts of a former official's speech in its fight with Ripple.
The complaint, filed on Monday, claims that users of Coinbase Wallet saw their funds transferred without their permission. George Kattula, the lead plaintiff, alleged that the unauthorized transfer occurred after he received an email from Coinbase asking to change his password.
Kattula claimed that close to USD 6,000 worth of cryptocurrency was withdrawn from his account after he attempted to change his password according to the provided instructions. The funds were then transferred to unknown parties.
The complaint alleged that,
“Coinbase improperly and unreasonably locks out its consumers from accessing their accounts and funds, either for extended periods of time or permanently. Because of the extreme volatility of cryptocurrencies’ value with free falls of 40% within 24 hours not unheard of, the inability to access an account to sell, buy, or trade cryptocurrency leads to severe financial loss to account holders.”
The class action suit also argues that Coinbase failed to timely respond to customer requests for support and help, and that it fails to preserve and safeguard customer assets as it promises.
Kattula further alleged that the exchange allowed hackers to steal USD 1,000 from his bank account. “Although Coinbase reversed the unauthorized transfer of
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