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COIN.US
id: 1610
Coinbase ($COIN) AML Failures, Data Breach, and Misleading Risk Disclosures Case
E.D. Pennsylvania
Court2:25-cv-02637
Case number04/14/2021
Class period Start05/14/2025
Class period End05/21/2025
Lead Plaintiff motion deadline- $COIN investors filed a claim against Coinbase for concealing major regulatory violations in the U.K., a material data breach, and misleading investors about its compliance systems.
- After the FCA revealed a breach involving over 13,000 high-risk users and fines against Coinbase’s U.K. subsidiary, $COIN dropped 5.5% on July 25, 2024.
Case Details:
Between April 14, 2021 and May 14, 2025, Coinbase assured investors it had strong anti-money laundering (AML) controls and regulatory compliance across global markets. In multiple filings and investor statements, Coinbase said it was subject to strict oversight from the U.K. Financial Conduct Authority (FCA) and that its subsidiaries complied with all applicable laws.
But internal failures were mounting. In 2020, the FCA flagged Coinbase’s U.K. arm—CB Payments Limited (CBPL)—for weak AML controls and imposed a voluntary restriction (VREQ) to block onboarding of high-risk users. Coinbase agreed but failed to implement effective controls. Between 2020 and 2023, CBPL allowed over 13,000 high-risk users to access its services, moving over $226 million in crypto—in direct violation of the FCA’s order.
On July 25, 2024, the FCA fined CBPL £3.5 million and stated Coinbase’s systems allowed potentially criminal transactions for nearly two years. $COIN dropped 5.5% that day.
Later, on May 14, 2025, Coinbase disclosed a material cybersecurity breach caused by bribed overseas contractors, who stole sensitive personal data from support systems and demanded a $20 million ransom. The company confirmed names, addresses, phone numbers, and masked Social Security digits were exposed.
Based on these events, $COIN investors filed a claim against Coinbase, accusing the company of the following:
- It misled investors about the strength of their compliance systems and risk controls in the U.K. and globally.
- It failed to disclose regulatory violations, FCA findings, and a major customer data breach until months after discovery.
Considering all the representations, investors believe Coinbase concealed serious operational and compliance failures to protect its valuation and growth narrative.
Case Type
US Securities Class Action
Case Status
Lead Plaintiff Appointment
Alleged Offence
Misleading Statements,
Fraud,
Failure to Disclose
Suspected Party
Directors,
Management
Security Type
Stocks
Trade Direction
Long
Shock Event Date
07/25/2024
Filing date
05/22/2025
Lead Plaintiff Deadline
05/21/2025