- Worldcoin (WLD) faces a potential fine of 1 billion Argentine pesos or $1.2 million in the charges filed by the provincial government of Buenos Aires.
- The company allegedly employed “abusive clauses” in its user agreement that were deemed unfair under the nation’s consumer laws.
The woes of Worldcoin continues as it was slapped with a new case in Argentina, following its court battles in Spain and Portugal. According to the formal charges filed by the provincial government of Buenos Aires, the company co-founded by OpenAI CEO Sam Altman perpetrated several consumer law violations through “abusive clauses” embedded within its user agreement.
Civil and Commercial Code Violations of Worldcoin
The Province of Buenos Aires (PBA) alleged Worldcoin had provisions in its agreement that allowed it to disrupt its services to the detriment of its users. What’s worse is it does not offer any kind of reparation or reimbursement to the parties affected.
The agreement also applied Cayman Island laws to residents of Argentina. This likewise made users waive their rights over filing collective grievances in court. Moreover, it instructed users to resolve any form of conflict that may arise through an arbitration in California.
PBA noted that these unscrupulous clauses have been enclosed in Worldcoin’s “Terms and Conditions of Use,” “Privacy Notice,” and “Data Consent Form.” It pointed out that these constituted a violation of the Civil and Commercial Code of the Argentine Republic, and different violations should be incurred for each.
Issues on Use of Minors and Data Storage of Worldcoin
In addition, PBA raised the findings of its audit on Worldcoin, which determined that it failed to adequately provide notices informing users that their service were not intended for people under 18. This lapse is suspected to have resulted in the iris scanning of minors.
Another dubious practice brought up by the complainant centered on the storage of biometric data collected from Argentine users. Tracking the bread crumbs led to an off-shore facility in Brazil based on the comments of Commercial Development and Investment Promotion Undersecretary Ariel Aguilar. Furthermore, the official questioned how data deletion is handled by the respondent.
Potential Penalty
PBA said Worldcoin failed to provide them with satisfactory response during summons. It claimed there were contradictions in the statements of the company during questioning, too.
With that, the provincial government decided to proceed with the formal charging of Worldcoin, which could result in a fine of 1 billion Argentine pesos or $1.2 million.
Worldcoin Now
Worldcoin’s native cryptocurrency WLD is trading at $4.86 amid the new controversy its developer has found its way into. The numbers are 4.6% down on the 24-chart, 30.49% below the seven-day frame, and 45.68% down in the one-month range. Nevertheless, it’s still 191% up over the one-year bracket.