American cryptocurrency exchange Coinbase has released a transparency report revealing more than 1900 requests for customer information and data from governmental agencies in the first six months of 2020.
In a blog post on the company’s website, Coinbase’s Chief Legal Officer Paul Grewal outlined the findings of the report which delves into government requests for account information of its customers in the first six months of 2020.
A massive undertaking
The post outlines Coinbase’s belief in protecting its customers financial privacy and explains that there is a concerted effort to protect information from ‘compromise, inappropriate use, or unnecessary disclosure.’
With that being said, Coinbase also serves a massive, global user base which includes more than 38 million people. Given that the company essentially provides a financial service of sorts, Coinbase receives requests from law enforcement and government agencies that are looking for access to account information and financial records of certain individuals.
The requests are usually connected to some form of civil, criminal or private investigation. Authorities have used subpoenas, search warrants, court orders and other legal processes in order to try and gain access to user information or account details.
As the article explains Coinbase has a legal obligation to responder if requests are considered valid in reference to financial regulations and other laws.
“As a financial institution with a duty to detect and prevent prohibited activity on its platform, we respect the legitimate interests of government authorities in pursuing bad actors who abuse others and our platform. Yet we will not hesitate to push back where appropriate, even when it is inconvenient or costly to do so.”
The company reportedly handles requests through the use of a team of experienced specialists, which checks if the request is valid and also works to ensure that requests are not given information for requests that are ‘overly broad’.
1914 requests in first half of 2020, 96 percent related to criminal investigations
The document contains a couple of pie charts and graphs that collate all of the governmental agencies and law enforcement requests for customers information and data.
The company received a total 1914 requests in the first six months of 2020, and 96 percent of these requests were related to criminal investigations.
1113 requests were made by American institutions, 441 came from authorities in the United Kingdom followed by 176 requests from Germany.
Honing in on the information requests from American authorities, 30 percent of requests came from the Federal Bureau of Investigations (FBI) while a further 16 percent of requests were from the Homeland Security Investigations. A total of 58 percent of all requests sent to Coinbase came from agencies in the United States.
The report also calls on other cryptocurrency exchanges and businesses as well as the traditional finance sector to be more transparent and forthcoming with insights and data.
“A final point: while transparency reports have become more common in tech, they remain rare in financial services. We think it is important not just for cryptocurrency companies, but for fintechs and banks at large to shed light on financial data sharing practices and contribute to the understanding of industry trends in a meaningful way.”