Coinbase hit with privacy class action over biometric scans

Coinbase class action lawsuit overview:

• Who: Three customers filed a class action lawsuit against Coinbase Global Inc. and Coinbase Inc.
• Why: The plaintiffs claim Coinbase collects and shares biometric data without getting user consent.
• Where: The Coinbase class action was filed in Illinois federal court.

A new class action lawsuit alleges Coinbase collects and shares biometric data without first obtaining user consent.

Plaintiffs Scott Bernstein, Gina Greeder and James Lonergan filed the class action complaint against Coinbase on May 13 in Illinois federal court, alleging violations of the Illinois Biometric Information Privacy Act (BIPA) and the Illinois Consumer Fraud and Deceptive Business Practices Act (IFCA).

According to the lawsuit, Coinbase uses facial recognition technology to verify users’ identities but fails to obtain the required consent from users before collecting their biometric data.

The lawsuit claims that Coinbase’s identity verification process involves users uploading a photo of their government-issued ID and a selfie. The company then uses facial recognition software to analyze and compare the images, generating a unique digital representation of the user’s face, known as a face template or face scan.

However, the plaintiffs allege that Coinbase does not inform users that their biometric data is being collected or provide them with the required notice and consent forms, which is a violation of the BIPA.

Coinbase allegedly shares users’ biometric data with third-party vendors

The lawsuit further alleges that Coinbase shares users’ biometric data with third-party vendors, such as Jumio and Onfido, without obtaining users’ consent. These vendors provide the facial recognition software used by Coinbase, and the lawsuit claims that they also store users’ biometric data on their servers.

The plaintiffs argue that Coinbase’s failure to obtain consent for the collection and sharing of biometric data puts users at risk of identity theft and unauthorized tracking.

The plaintiffs are suing on behalf of all Illinois residents who had their biometric data collected by Coinbase in the past five years. They are seeking an injunction requiring Coinbase to comply with BIPA’s notice and consent requirements as well as damages of $5,000 for each intentional violation and $1,000 for each negligent violation.

The lawsuit also seeks damages under the ICFA for Coinbase’s alleged deceptive business practices.

Coinbase recently faced a class action lawsuit alleging it failed to protect users from a “pig butchering” financial scam by neglecting its legal obligations under the Bank Secrecy Act and California law to verify customer identities and monitor suspicious activity.

Do you use Coinbase? Let us know what you think of the biometric data collection allegations.

The plaintiffs are represented by Mark R. Miller and Matthew J. Goldstein of Wallace Miller and Jonathan Gardner, Carol C. Villegas, Jonathan D. Waisnor, James M. Fee and Danielle Izzo of Labaton Keller Sucharow LLP.

The Coinbase class action lawsuit is Bernstein, et al. v. Coinbase Global Inc., et al., Case No. 1:25-cv-05313, in the U.S. District Court for the Northern District of Illinois.

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