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Financial Services Law Insights and Observations

CFPB analyzes crypto complaints

Federal Issues Digital Assets CFPB Consumer Complaints Cryptocurrency

Federal Issues

On November 10, the CFPB released a consumer complaint bulletin analyzing consumer complaints related to crypto-assets that the Bureau received from October 2018 to September 2022. According to the report, the Bureau received more than 8,300 complaints, with the greatest number of complaints coming from California. Among the complaints, the most common issue consumers identified was fraud and scams, followed by transaction issues. Additionally, analysis suggests that complaints related to crypto-assets may increase when the price of Bitcoin and other crypto-assets increase. The report noted that consumers had issues with accessing funds in their accounts due to identity verification issues, security holds, or because of technical issues with platforms. The Bureau also reported that customer service issues also were a common theme across crypto-related complaints. Other highlights of the report included, among other things, that: (i) crypto-assets are often targeted in romance scams, where scammers play on a victim’s emotions to extract money; (ii) crypto-assets are a common target for hacking; (iii) older consumers report a higher rate of crypto-asset related frauds and scams compared to complaints overall; and (iv) crypto-asset complaints and fraud reports have also been increasing at the FTC and SEC. The Bureau also provided steps for consumers to take to protect themselves, such as watching for signs of a scam, reporting suspicious FDIC insurance claims, and submitting a complaint to the CFPB.