Crypto Currency Exchange Poloniex Intrigued by DOJ’s Move to Reach Users

Crypto Currency Exchange Poloniex Intrigued by DOJ’s Move to Reach Users

Digital currency exchange operator Poloniex is intrigued by the actions of the Department of Justice of Delaware. The Investor Protection Unit (IPU) of the DOJ has reached out to investors or users whether they have any issues. The IPU’s chief special investigator has not only written to a list of users but also wanted them to reach him if they have any difficulties in managing their account with the exchange. The move assumed importance given the fact that there are increasing thefts of digital coins.

Enforcing Provisions

The IPU forms part of the fraud, as well as, consumer protection division. The objective of the division is to curb not only any forms of white collar crime but also frauds involving consumer and securities. The unit is entrusted with the responsibility of enforcing Delaware Securities Act provisions apart from the rules and regulations relating to the act. The cryptocurrency exchange was established in January 2014 and is based in Wilmington apart from Delaware.

Significantly, the digital currency was acquired by Goldman Sachs Group backed mobile-payments firm, Circle Internet Financial Ltd in February. It was ranked as the 25th biggest virtual asset exchange with a listing of nearly 100 digital coins in May. The company has now become under the scanner of Delaware’s DOJ as the IPU is engaged in reviewing and investigating complaints from investors. They are also focusing on broker-dealers and investment advisors. This would mean that if any individual or firm is caught with a foul play, the IPU will enforce actions based on the State’s securities act, Cointelegraph reported.

The actions followed after users of the cryptocurrency exchange have started complaining about either stuck or missing deposits in an unofficial subreddit. A user commented, “It seems I’ve joined the ranks of countless users who have a missing / “stuck” deposit – one of those where every block explorer shows your funds in your Poloniex-sanctioned deposit address, sitting politely with 400 thousand million confirmations, while your account never actually reflects said funds….”

Similarly, there were complaints from other users stating that their accounts were frozen. On top of this, they could not get any response from Poloniex. This has resulted in one of the users closing down his account though he disclosed that he was not a victim directly. The amount of complaints has forced him to take the extreme step.

Class Action Suit

The developments have obviously irked some users, and a user called “PoloniexSuit” indicated on taking steps towards filing a class action suit against the digital currency exchange. In response, the company pointed out that there should be enough reason to pursue the litigation. Interestingly, this is not the first time that users have made complaints against the exchange.

In May too, users of Poloniex have made complaints about freezing despite completing the mandatory new procedures for identity verification. Account holders pointed out that once they confirm their identity through social media, they were allowed to continue trading. However, their previous account was blocked by the exchange.

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