The U.S. Supreme Court has rejected a request from James Harper, a Coinbase user, who tried to stop the IRS from seeing his crypto trading records. The IRS can now proceed with its probe into some Coinbase users who did not properly report their crypto income.
At the heart of the case is James Harper, a Coinbase user who had contended that the IRS abused his constitutional right to privacy under the Fourth Amendment by getting his trading history without a warrant.
The IRS had employed a legal process known as a “John Doe” summons in 2016 to get records of active trading Coinbase users who were not reporting profits. Harper was among them. Harper sued the IRS, but lower courts ruled against him, stating the information belonged to Coinbase, not Harper individually.
The government also cited the United States v. Miller case, which established that individuals do not have privacy rights over financial records held by third parties. Additionally, Coinbase’s privacy policy warns users that their data may be shared with law enforcement when required.
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