Bitcoin Forum

"On Feb 23, 2013 you purchased 10.00 BTC via bank transfer for $286.69.

Unfortunately, we have decided to cancel this order because it appears to be high risk. We do not send out any bitcoins on high risk transactions, and your bank account will not be charged.

Please understand that we do this to keep the community safe and avoid fraudulent transactions. Apologies if you are one of the good users who gets caught up in this preventitive measure - we don't get it right 100% of the time, but we need to be cautious when it comes to preventing fraud.

You may have more luck trying again in a few weeks. Best of luck and thank you for trying Coinbase."

I have made transactions with them before, I think this is BS and they just don't want to payout becouse of the price increase!

EDIT:
I received this from customer support at 12:09 AM PST on March 1st: "Hi,

Sorry about that! After manually reviewing your account I've whitelisted it so you shouldn't experience any additional issues going forward. I've also pushed through the transaction that was canceled previously (at the original exchange rate you locked in), so you should have those coins by the end of tomorrow. In addition, we recently wrote a blog post about this you might find interesting: http://blog.coinbase.com/post/44046687068/high-risk-transactions

Hope it helps and sorry again for the trouble!"

EDIT: After three days there is no evidence of a transaction occurring or about to occur in either my Coinbase account or my bank account. And no further response from Coinbase.

UPDATE:3/12/13
So the original funds I had in my spare checking account (wont let anyone have direct access to my primary) to purchase BTC I moved a week ago to buy BTC elsewhere. I also sent them an email 7 days ago asking them what was going on that and that there was no indication of transaction occurring in my coinbase account. Thinking it had been canceled as there was no response from their support or any indication of a transaction I only had a $240 balance in my account today. So guess what... blammo it was debited today with no warning, indication or email from Coinbase in the last two weeks. And hello $35 Wells Fargo overdraft fee... and no the bank wouldn't reverse it even after moving funds from another account an hour later. They said it was "pre-authorized" and they could not reverse it.

So moral of the story, Coinbase can, will and does debit transaction upwards of a month after the initial order with no warning or indication after they told you they cancelled your order and provided no proof of a reversal. Whats next? Double debits? Even right now there is no indication of a transaction in my Coinbase account. Still no BTC either.

UPDATE: I RECEIVED MY BTC! All is well, Coinbase was true to their word.!

An after sending a couple emails to support I have heard nothing back.

Try tweeting to @coinbase  They reply actively there. 

I don't see why they would consider that a high risk transaction. Contact their twitter feed for additional support, and if they don't help you out... well, I guess they'll lose more business.

Just tweeted them, will see what they say. Thanks for the tip!

No problem.  Good luck getting your issue resolved!

I just had this happen with an order today as well. What irks me is that they make no effort to contact you or verify whether or not you are actually trying to scam them. You just get an email saying that it has been cancelled and that you are SOL. I'm going to start buying bitcoins elsewhere.

This was on their blog:

"A Coinbase customer wrote in with a question today.  I figured other people may benefit from the response so with his permission I’ve decided to publish it along with our response.  Hope it helps!

Hey Coinbase,

          Just wondering what the deal was with the cancelled transaction. Your service is fantastic and I am a big supporter overall. It’s just I’ve been seeing a lot of complaints of people having their bitcoin purchases cancelled at the last minute. This is a huge problem with bitcoin because the price is so variable. With the 5 day wait period, locking the price in is important as you know and it’s really not fair to people to let them know at the last second they won’t be getting their bitcoin. That’s just a punch in the gut, and it is causing financial loss.

       I’ve made so much money buying bitcoins from you guys I’m going to have to declare it on my taxes for 2013. I’m not concerned about the $ amount so much as that it just doesn’t happen again. $20 bucks is a worthy price to pay to use your service.

I would just like to get some clarification as to why, all of a sudden, after thousands of dollars of purchases, my transaction was “high-risk.” An inconsequential 10 btc purchase. I think you need to better explain why people are having their transactions cancelled.

Best,
Concerned Customer


Dear Concerned Customer,

Sorry about that - after manually reviewing your account I’ve gone ahead and whitelisted it so you shouldn’t experience any more issues (I see you have started some additional purchases, these will go through as normal).

I agree with you on the high risk emails being frustrating.  And you’re absolutely correct that we haven’t done a good enough job explaining the reason behind them.

To give you some context, as one of the few bitcoin services offering payment via consumer friendly (reversible) payment methods we are essentially under attack 24/7 by hundreds of scammers around the world entering fake bank accounts etc trying to steal bitcoins.  We expected this when we launched the service, and are about 80% of the way through building a world class fraud prevention system.  Obviously this is a complex engineering challenge, something that took companies like Paypal several years to get a handle on.  We’ve already solved the majority of issues to make it a net-positive operation, but it will still require a lot more work going forward.  And the user experience has definitely suffered a bit in the mean time while we have waged this war.

A few points worth mentioning:

1. There is no human reviewing the transactions deciding they are high risk.  These are automated systems that make educated guesses looking for suspicious signals, and they only get 80-90% accuracy right now.  The good news is that the more transactions we do the smarter and more accurate these systems become over time.  But there is no human at Coinbase passing a value judgement.  The only time a human is involved is when we manually review an account after a mishap like in your case to whitelist or take some other action.

2. This of course only affects converting USD (or your local currency) into or out of bitcoin.  Bitcoin-to-bitcoin transactions don’t face these issues and are never canceled (as long as they are accepted by the rest of the bitcoin network).

3. A 10 BTC purchase may not sounds like much, but with high volumes small percentage changes can make a big difference.  So let’s say everyone is doing 10 BTC purchases, and in aggregate we’re doing about $3M a month in bitcoin sales.  If our fraud rate changes from 1% to 2% we’d lose an additional $30k that month.  As sales keep growing, small changes like this will only be magnified.


Anyway, building systems like this is what we’re good at and love working on so we’re definitely not complaining - but I just wanted to provide some context as you requested.

It’s also worth noting that we only buy the amount of coins we expect to pay out, adjusted for estimated fraud. For example, if we have 100 bitcoin of purchases and estimate 3 bitcoin are fraudulent, we only buy 97. Thus, we don’t profit from a canceled order. More broadly, a few dollars here and there from unrealized gains isn’t what’s important to us -
we want to build something long lasting that brings bitcoin to the masses.

Thank you for bearing with us as we continuing working on improving things.  Having an easy way for people to buy and sell bitcoin (via consumer friendly, reversible, payment methods) is an important part of the bitcoin ecosystem.  Our goal is to provide this link and do it better than anyone else.  We certainly don’t have everything working perfectly today, but we’re getting a little closer each day.

Thank you,
Brian Armstrong"

So it seems like several customers have had their orders canceled recently. I don't know how their system works in detail, but I am guessing with the recent jump in price they don't have enough BTC to cover the the jump without losing money?

He doesn't really address why it's being done at the last second. What information changes? If something triggered their flag, why wouldn't they cancel it instantly, so people could buy through other channels?

Their cancellation email was sent to me a couple hours before the BTC was to be deposited in my account, after waiting since last Saturday. They must not have had the BTC to cover the jump in price. Long live my $50 profit on $286. lol!

Exactly. There is no reason why their risk formula would be any different 5 minutes after I place the order or 5 minutes before it is supposed to clear. I could maybe understand this if it was someone's first transaction but most of these (including mine) were not first transactions.

Talk about an elephant in the room! The one thing that the response did not mention was why the transaction was cancelled. I don't see how a wire transfer (which is as good as cash) from a repeat customer could be considered "high risk", unless they mean "high risk of losing money on the deal".

I agree with the OP. The most likely reason that they canceled the transaction is that they didn't want to lose a bunch money on the deal.


And furthermore, now that they believe that the OP is not a high risk, why haven't they honored the purchase?

Given the evidence I am assuming they wait until the debit (ACH) from your account clears, at which point they purchase the BTC you ordered several days later with the cash they received (lower risk with cash in hand). So if their reserve BTC was used up, it is easy to hide behind the "Unfortunately, we have decided to cancel this order because it appears to be high risk" to prevent lost profit on their end.

Given that same example, lets say the reverse happened and the priced decreased $6.... that would mean $6 per BTC in their pocket. Moral of the story, we can't count on Coinbase with the wild recent upward bullish trends of BTC. Guess it's back to cash deposits and Bitinstant.

I just received a reply from Coinbase:

"Hi,

Sorry about that! After manually reviewing your account I've whitelisted it so you shouldn't experience any additional issues going forward. I've also pushed through the transaction that was canceled previously (at the original exchange rate you locked in), so you should have those coins by the end of tomorrow. In addition, we recently wrote a blog post about this you might find interesting: http://blog.coinbase.com/post/44046687068/high-risk-transactions

Hope it helps and sorry again for the trouble!"

I will post if and when I receive the coins. I know they are a new and upcoming company so after their prompt & courteous reply I will cut them some slack. However I have noticed on other Topics that you have to raise some hell to get the cancellation reversed. Like the old saying goes "squeaky wheel gets the grease."

I still have not received my BTC as promised. There is no evidence of a transaction in either my bank account or my Coinbase account.  I have sent a couple emails to support but I doubt they work weekends. Will post if they actually reverse the cancellation as promised. So this day #9 since my initial order. Glad BTC is still going up. lol!

No problem.  Good luck to you.

It seems pretty obvious why theyre canceling these orders. Btc has jumped a considerable amount since you placed your orders, and they dont want to take a loss.. If btc would have dropped to say $28 im sure you would have all received your btc.

This is driving me nuts, I have $300 in my account that I can't move around because I have no idea if or when it will be debited. I want to move it to my Dwolla account, but after their reply:

"Hi,

Sorry about that! After manually reviewing your account I've whitelisted it so you shouldn't experience any additional issues going forward. I've also pushed through the transaction that was canceled previously (at the original exchange rate you locked in), so you should have those coins by the end of tomorrow. In addition, we recently wrote a blog post about this you might find interesting: http://blog.coinbase.com/post/44046687068/high-risk-transactions

Hope it helps and sorry again for the trouble!"

It was supposed to go through 2-3 days ago. Still no response from their customer service after an email this morning and yesterday morning :(

Yup, they did the same thing to me! The price of BTC jumped the day after I ordered and all of a sudden my trans was cancelled. They said my email wasn't from a trusted source??

not reliable. I keep seeing others recommending them. I wouldnt trust them honestly

Still no BTC. After being told multiple times my cancellation will be reversed I have yet to receive any BTC or proof in my account that I am about to. The last time they replied to my messages on March 5th:

"Hi Jared - taking a look at the original thread now. Sorry for the delay, but rest assured we will make it right.

Regards,
Fred"

I do not trust Coinbase and will not be using them in the future.

So the original funds I had in my spare checking account (wont let anyone have direct access to my primary) to purchase BTC I moved a week ago to buy BTC elsewhere. I also sent them an email 7 days ago asking them what was going on that that there was no indication of transaction occurring in my coinbase account. Thinking it had been canceled as there was no response from their support or any indication of a transaction I only had a $240 balance in my account today. So guess what... blammo it was debited today with no warning, indication or email from Coinbase in the last two weeks. And hello $35 Wells Fargo overdraft fee... and no the bank wouldn't reverse it even after moving funds from another account an hour later. They said it was "pre-authorized" and they could not reverse it.

So moral of the story, Coinbase can, will and does debit transaction upwards of a month after the initial order with no warning or indication after they told you they cancelled your order and provided no proof of a reversal. Whats next? Double debits? Even right now there is no indication of a transaction in my Coinbase account. Still no BTC either.

I RECEIVED MY BTC! All is well, Coinbase was true to their word.!

Great, now you are whitelisted time to start fraudin!

JK
Seriously though, was this a wire transfer or an ACH?

LOL! It was an ACH.

Without any indication or heads up the transaction went through and I ended up over drafting my secondary account by $40 and incurring a $35 Wells Fargo overdraft fee on March 12th. After talking to multiple people Wells Fargo refused to reverse the overdraft even after I corrected the overdraft within two hours on the same business day.

I wrote Coinbase and explained the situation stating it was not fair to provide no information of a transaction either through email or within my Coinbase account. Given that I had no idea when or even if a transaction was going to occur I was unable to accurately move funds around between my accounts in advance.

Coinbase in response sent me $35 in BTC to cover the overdraft fee. They went above and beyond when they did not have to. I highly recommend them. I understand they are an up and coming company that currently consists of a two man team. Yes they have some issues, but what new up and coming company doesn't? They have honor and integrity, that goes a long way in my book.

Ok that makes more sense, I do not think you can fraud a wire transfer because its a push not a pull, but ACH you can. HOWEVER there is a simple procedure: They should run the ACH, and keep the money in suspense for a week.

Interesting! Thanks for the update.

The signatory of a personal (but not business) bank account can dispute an ACH transaction as fraudulent up to 60 days from the statement in which the fraudulent transaction was reported.    Keeping funds a week would do little good against "friendly fraud".

Sorry for bumping an old thread, but has anyone else had this happen to them?  I recently bought quite a few BTC when the price bottomed out a few days ago and right when I was expecting to get my coins deposited, I received the same email the OP got.  I've sent their customer service an email letting them know about their mistake and that there's no risk (given what BTC are currently going for, it'd be crazy of me to want to reverse the transaction), but no response yet.  How long does it normally take for the Coinbase people to respond to emails, and is there any chance my order actually will go through at the original price?

Thanks!

Placed an order for 2 BTC April 19th with deliver expected today. Did not get an email. Logged in to check on status and find

"You purchased 2.00 BTC   show   Canceled   Apr 19, 2013"

Cancelled!? Why? Because price went up? I emailed them and waiting to here back. Geez

Yes! This just happened to me a few days ago, which was pretty upsetting considering i thought i had bought it in the $60s. I sent them an email through the contact form on their website yesterday, and just heard back today that they were going to push the transaction through-- and at the price I had bought the BTC for.

Considering the story above about being reimbursed for an overdraft fee, I think they are pretty committed to keeping everyone happy, but they use some automated process that denies a lot of the purchases-- maybe to cover their asses, maybe because it's a small operation, or some combination of both.

Just send them a support request through their website and they will probably have it straightened out within a few days.

To be a Bitcoin exchanger is a very risky business because they are target for criminals who steal money from bank accounts. According to rumors, the main reason to shut down the Bitcon-24.com is that someone is stealing money from bank accounts and launder them with this Bitcoin exchanger.

Therefore, the Bitcoin exchangers have many anti-fraud filters and sometimes they have false positives.

Also many banks don't want to provide bank account for exchangers - see Bitfloor.com:


Also Mt. Gox have problems to open bank accounts and complain about this on their Facebook page: