Coinbase found guilty of administrative offense, fined 1 million Ruble in Russia for incompliance
|- Coinbase and AIDA International have been found guilty of administrative offense in Russia.
- The two entities refused to localize the data of Russians in the Russian Federation, incompliance to record and systemize citizen data.
- The magistrate’s court determined that they each pay $1 million Rubles, approximately $10,840 at current rates.
Coinbase has found itself in another regulatory debacle, this time not with the US Securities and Exchange Commission (SEC), but with Russia’s magistrate court at the Judicial District 422. Russian local media reports.
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Coinbase fined for incompliance
Coinbase, the largest US-based cryptocurrency exchange by trading volume, has been found guilty by a magistrate’s court in Russia for incompliance. According to Russia local media, the exchange, together with a global association called AIDA International, refused to localize the data of Russians in the Russian Federation.
Charged for what has been described as an “administrative offense,” both firms have been fined up to 1 million Rubles each, equivalent to about $10,840 at current rates. It falls under Part 8 of Article 13.11 of the Code of Administrative Offenses of the Russian Federation, described as:
Failure by an operator to comply with the obligation to ensure the recording, systematization, accumulation, and storage of data of citizens of the Russian Federation when collecting personal data.
Notably, the companies were threatened with sums of up to 6 million rubles each ($65,040), with the media reporting that the fines imposed in the amount of 1 million rubles are minimal under this article.
It comes a month after a directive in May 2023 by the Federal Service for Supervision of Communications, Information Technology and Mass Media, the Russian federal executive agency responsible for monitoring, controlling and censoring Russian mass media, abbreviated as Roskomnadzor, that foreign services must localize databases of Russian ussers in the Russian Federation beginning July 1, 2023.
Local media reports that about 600 representative offices of foreign companies in the Russian Federation localized the storage of personal data of Russians.
Meanwhile, it is worth it to not that Coinbase and AIDA are not the only perpetrators. Video communication service, Zoom, was fined by the same court for a similar violation, having to pay up to 15 million Rubles ($162,600) for repeated refusal to localize the data of Russian users in the Russian Federation.
Message app Telegram was also cited, paying 50,000 Ruble ($542) in fines, with Spotify, Apple, WhatsApp, Tinder owning firm Match Group, Airbnb, Google, Twitch, and Pinterest, among others, also recording a history of incompliance in Russia for refusing to localize data.
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