The US Department of Justice has launched an investigation into Coinbase, a major cryptocurrency exchange, following a data breach involving customer service agents in India who allegedly accepted bribes from criminals in exchange for granting access to user data. The probe was initiated after Coinbase disclosed the breach on May 15, stating that a group of customer support contractors had misused their access to systems to steal account data of a small group of customers.

Coinbase's chief legal officer, Paul Grewal, stated that the company is cooperating with the DOJ and other law enforcement agencies in the US and internationally to pursue criminal charges against those involved in the breach. Although Coinbase assured that no passwords, private keys, or funds were exposed, the incident led to social engineering attacks targeting users, with losses estimated to be as high as $400 million. The attackers also attempted to extort $20 million from Coinbase to keep the breach confidential, an offer which the company declined.

The aftermath of the breach has prompted numerous lawsuits against Coinbase, with users alleging mishandling of their personal data. One such user, a retired artist named Ed Suman, reported losing $2 million to scammers who exploited the stolen data. The breach and the subsequent legal challenges have caused fluctuations in Coinbase's stock price, compounded by an unrelated SEC probe into the exchange's reported "verified user" numbers.

In response to the developments, Coinbase has faced mounting pressure and scrutiny from both regulatory authorities and affected users. The company's reputation has been marred by the breach and the subsequent fallout, with concerns raised about the security of user data and the efficacy of its customer service practices.

As the investigation unfolds, the cryptocurrency community and investors are closely monitoring the situation to assess the impact on Coinbase's operations and reputation. The outcome of the DOJ probe and the legal battles stemming from the breach could have far-reaching implications for Coinbase and the broader cryptocurrency industry, highlighting the importance of robust security measures and regulatory compliance in safeguarding user data and maintaining trust in digital asset platforms.

Source: https://cointelegraph.com/news/justice-department-coinbase-data-breach?utm_source=rss_feed&utm_medium=rss&utm_campaign=rss_partner_inbound