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Binance alleged to have collected biometric data unlawfully in US

Binance is facing a class action lawsuit in Illinois, which alleges that the world’s largest

 cryptoexchange has unlawfully collected its users’ biometric data.

Kamil Kuklineski, a resident of Illinois, has launched litigation against Binance Capital Management Co in a state court. This is the Binance entity registered in the British Virgin Islands, although the company operates in practice through a variety of holding companies. In the case of the United States, the company does business through BAM Trading Services, which itself supports Binance.US. The class suit alleges that Binance partnered with biometric firm Jumio Corporation to collect user data and that both companies violated the state’s Biometric Information Privacy Act.

In order to open an account with Binance.US, users must input personal information about their identity. This includes information such as their full name, address and birthdate. As part of this process, Binance.US used Jumio’s biometric technology to scan users’ faces and verify their identity. According to the lawsuit, “this process required in part, the taking of images of a user’s driver’s license or other state and federal photo identification and a “selfie” of the user to capture, analyze and compare biometric data of the user’s facial features.”

Kuklineski’s lawyers allege that Binance.US did not disclose to users how long their data would be retained for, how it would be stored, or how it would be used. They also claim that the company did not obtain “proper written consent” and that users were not told that their “selfie” would be used to obtain and store personal biometric data.

Kuklineski also argues that Binance.US’ terms and conditions do not mention the collection of biometric data, and nor does the company’s privacy policy. As the court papers outline, Binance.US’ Android and Apple apps were updated in May 2021. In this updated version, the app includes a notification prior to activating the device’s camera: “by clicking “continue” you consent to Jumio collecting and disclosing your biometric data pursuant to its Privacy Policy.” However, this notification did not appear in previous versions of the app. Kuklineski’s lawyers therefore allege that users’ data was being collected and stored unlawfully.

This follows news that Binance is also facing litigation in the Hong Kong International Arbitration Center. Over 700 traders are trying to recoup money that was lost when the Binance platform suffered major technical flaws during a Bitcoin crash in May. Binance has denied any responsibility for lost funds. This case in Illinois is likely to raise further questions about Binance regarding how the company collects and uses private data from consumers.

Binance and Jumio did not respond to a request for comment.