Coinbase Faces New Class-Action Lawsuit Over Data Breach, UK Agreement Breach

Coinbase and two of its top executives are facing a new proposed class-action lawsuit, filed by investor Brady Nessler, over the sharp decline in the company’s stock price following the disclosure of a recent data breach and an alleged failure to disclose a regulatory violation in the UK. The complaint, filed on May 22 in a Pennsylvania federal court, accuses the crypto exchange of failing to properly inform investors about a key agreement breach with the UK’s Financial Conduct Authority (FCA), which, combined with the breach disclosure, led to significant shareholder losses. UK Regulatory Violation Adds to Coinbase Legal Woes According to the lawsuit, the drop in share price wasn’t solely due to the breach. Nessler pointed to a July 2024 penalty by the FCA, where Coinbase’s UK division was fined $4.5 million for breaching a 2020 agreement not to onboard high-risk customers. The FCA claimed the exchange had onboarded over 13,000 such individuals, despite restrictions. Nessler alleges that this violation, and Coinbase’s failure to disclose it prior to its 2021 Nasdaq listing, artificially inflated the stock’s value. She further claimed that had investors known about the breach of the agreement, they would have reconsidered purchasing the stock. Following the FCA fine, Coinbase shares fell over 5%, closing at $231.52 on July 25, 2024. The lawsuit names CEO Brian Armstrong and CFO Alesia Haas as co-defendants and seeks damages on behalf of all investors who purchased company shares between April 14, 2021, and May 14, 2025. It also demands a jury trial. More Legal Trouble Ahead Earlier this month, the exchange revealed that it was the target of a $20 million extortion attempt, which exposed internal weaknesses after customer support agents were bribed. The attackers reportedly gained access to limited user account data. The company estimated potential damages could climb to $400 million. On the day of this announcement, May 15, Coinbase shares dropped 7.2%, closing at $244. Though shares rebounded the next day, climbing 9% to $266, the volatility highlighted growing investor concerns. The latest suit is part of a growing list of legal actions against Coinbase , with at least six lawsuits filed following the data breach disclosure. Another case filed in Illinois accuses the company of improperly collecting and handling biometric data without proper disclosure. The post Coinbase Faces New Class-Action Lawsuit Over Data Breach, UK Agreement Breach appeared first on TheCoinrise.com .

Source: The Coin Rise