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The US Department of Justice is reportedly investigating Coinbase\u2019s contracted customer service representatives in India, who accepted kickbacks in exchange for granting criminals access to user information.<\/p>\n
According to a May 19 Bloomberg article, DOJ investigators are examining the data breach, which Coinbase made public<\/a> on May 15. The exchange indicated that a group of customer support contractors \u2014 who were subsequently dismissed \u2014 \u201cmisused their access to […] systems to pilfer the account information of a small group of customers.\u201d<\/p>\n \u201cWe have informed and are collaborating with the DOJ and other US and international law enforcement bodies and support law enforcement\u2019s pursuit of criminal activities against these unscrupulous individuals,\u201d stated Coinbase\u2019s chief legal officer, Paul Grewal, according to Bloomberg.<\/p>\n <\/p>\n Related: <\/strong><\/em>New Zealand individual detained in $265M crypto scam associated with FBI inquiry<\/strong><\/em><\/a><\/p>\n Although \u201cno passwords, private keys, or funds were compromised\u201d according to Coinbase, the data breach led to social engineering schemes aimed at users, including a Sequoia Capital partner<\/a>, with estimated losses reaching up to $400 million. The perpetrators also tried to extort $20 million from Coinbase in exchange for withholding information about the breach, which the company rejected.<\/p>\n The attempted social engineering schemes have led Coinbase users to file numerous lawsuits<\/a> against the exchange, claiming that the firm mishandled their personal information. One user, a retired artist by the name of Ed Suman, reported a loss of $2 million<\/a> to the fraudsters.<\/p>\n Following the breach announcement, Coinbase\u2019s stock price experienced volatility, and an unrelated investigation<\/a> from the US Securities and Exchange Commission regarding its declared \u201cverified user\u201d figures. Cointelegraph contacted Coinbase for feedback but had not received a response at the time of publication.<\/p>\nLegal repercussions<\/h2>\n