PSA: Coinbase.com is a fraud

[accord01]

Coinbase.com is NOT an exchange, it is NOT a service... it is a company made for the SOLE purpose of trading and hedging customer funds and defrauding the customers and getting away with it.

I don't know where to begin when it comes to coinbase.com being dishonest in their practices, website, terms of service, and blog responses... all to defraud the customer.  For some of the customers that they defraud via the "high risk transaction" scheme, they actually recreate the original transactions and make it right.  For others (most likely the larger amounts they pocket), they simply never respond, leaving you hanging and burning.

They even give you back the money they steal from you SOME of the times, to make it look like they are not a total scam.  Other times, they pocket the money and simply stop responding to you or respond with this email:



"I am extremely sorry for the confusion on this. I've taken further steps to review your account and at this point we've been able to get you whitelisted. Any future purchases you make from this point forward will not encounter this cancellation. Unfortunately, since the refund has already been sent out on these original purchases, I'm unable to push through or re-create the original transactions.

Again, I apologize for the frustration this has caused. If you need further assistance please let me know and I'll be happy to help!"





What? You admit it was YOUR fault, but you can't give me back my money???  and you're sorry? and you'll be happy to help??? This does not compute!

They have stolen money from people who have previously done HUNDREDS of successful transactions by canceling orders and calling it a "high risk transaction".

They have also canceled bitcoin transfers WITHOUT notice or any record in the history.

Here is a small collection of threads showing how coinbase has profited off of customers by stealing their money via the high risk transaction scheme:


https://bitcointalk.org/index.php?topic=339849.msg3655636#msg3655636

https://bitcointalk.org/index.php?topic=328076.0

https://bitcointalk.org/index.php?topic=322631.msg3454765#msg3454765

https://bitcointalk.org/index.php?topic=322229.0

https://bitcointalk.org/index.php?topic=332565.new#new

https://bitcointalk.org/index.php?topic=321684.msg3450929#msg3450929

https://bitcointalk.org/index.php?topic=328013.msg3531406#msg3531406

https://bitcointalk.org/index.php?topic=328013.msg3526610#msg3526610

https://bitcointalk.org/index.php?topic=338172.msg3627572#msg3627572

http://bitcoin.stackexchange.com/questions/14195/did-i-just-get-defrauded-by-coinbase

Personally, coinbase canceled 3 orders of 15 bitcoins that has costed me over $6000.00 as of right now.  They simply stopped responding to my support ticket.  And the last email I got from them it said the following:

1) It was their mistake, and sorry for all the hassles such as holding your money in limbo for so long and the emotional hassles

2) You have been whitelisted

3) You won't be able to get your money back and the money that you should have made, we have already pocketed it (aka we are selling those bitcoins of yours for a MUCH higher price now).

4) But if you stay with us, we guarantee you won't be robbed again.  Thank you and come again.


Personally, I think it is VERY smart for them to give back what you have stolen in smaller transaction, such as .5 btc or 1 btc, and pocket the larger ones like mine... So you can say, "see, we made a mistake but we corrected it"  

Thanks for ruining people's lives, coinbase.com!  

One more thing, we, the customers aren't exactly helpless though.  Thank God for the land of the free.  I hope EVERYONE (not just the people that have been robbed) files a complaint with coinbase.com.  Sure it could be useful for those that have dodged the bullet, but a company like this CANNOT be good for digital currencies in the long run.

Here is the form, very simple to fill out:

http://oag.ca.gov/contact/consumer-complaint-against-business-or-company


And from what I've heard, they are quite capable of getting you something compensated.

Just fill out coinbase.com for the company or maybe fill out San Francisco for city.  Coinbase obviously doesn't supply an address or contact info.

For bitcoin to be healthy, companies like coinbase.com needs to be weeded out.

[wopwop]

Hehe you call it fraud, they call it their business model

[coinpr0n]

I believe that their intentions were good, but they were over-reaching in their promises their service company offers. Too many have drunk from the coinbase kool-aid.

[Korbman]

We see this time and time again where people somehow expect that Coinbase operates in the same manner as Mt. Gox, BitStamp, or the other true exchanges. For the latter examples, live order books are used to process your buys / sells...which is why you're able to act quickly to sell / buy during the spikes and dips we've seen over the past week. You're trading with people directly on the exchange.

Coinbase, on the other hand, is used more to sell Bitcoins than to purchase them (thanks to the massive price volatility).
Selling happens instantly at whatever the market rate is, and depositing to your bank account happens within a few days. Buying Bitcoins is a challenge since there isn't an order book...If you want to buy 5 Bitcoin at $500 each, Coinbase has to withdrawal $2500 from your bank account to make the exchange. But if during that time the price soars to $600, $700, etc, they can't just suddenly withdrawal $3000, $3500, etc. from your account...nor can they only give you a smaller amount of Bitcoins than you originally ordered. The result is for them to cancel your order.

[accord01]

We see this time and time again where people somehow expect that Coinbase operates in the same manner as Mt. Gox, BitStamp, or the other true exchanges. For the latter examples, live order books are used to process your buys / sells...which is why you're able to act quickly to sell / buy during the spikes and dips we've seen over the past week. You're trading with people directly on the exchange.

Coinbase, on the other hand, is used more to sell Bitcoins than to purchase them (thanks to the massive price volatility).
Selling happens instantly at whatever the market rate is, and depositing to your bank account happens within a few days. Buying Bitcoins is a challenge since there isn't an order book...If you want to buy 5 Bitcoin at $500 each, Coinbase has to withdrawal $2500 from your bank account to make the exchange. But if during that time the price soars to $600, $700, etc, they can't just suddenly withdrawal $3000, $3500, etc. from your account...nor can they only give you a smaller amount of Bitcoins than you originally ordered. The result is for them to cancel your order.

You've gotta be kidding me.  You're okay with that?  Is this the best defense you have for a crooked company like coinbase?  What you said isn't even true and even if it is they have your money in limbo for 2 weeks.  And in that time frame you could have bought your coins from somewhere else.  


But what you said isn't true, because coinbase buys the coins immediately after the order.

Also, there's plenty of times where price goes up, and transaction is not canceled.  

They even explain it differently.  They say the high risk transaction thing is anti fraud.  The thing is, you don't receive ANY new info about the customer from receiving their money.  The same info of the customer is availabe at the time of purchase.  So they could very well deny the purchase BEFORE taking the money.  But they deny it AFTER taking your money.  By doing this, it is a buffet for them.  All you can take.  They can choose to profit in any way they like.

[coinpr0n]

Do they give you the difference back if the price goes down?