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Cryptocurrency exchange Coinbase randomly locks users out of their accounts for months at a time causing them to lose funds, and even erased accounts in their entirety, a new class action lawsuit claims.
The nationwide class action lawsuit was filed in California on June 4 by lead Plaintiffs Michael Leone, Joseph Treseder, Travis Reece, David Beavers, Fazal Us Saboor Ali, and Keisha Pinkey. The group of Coinbase users allege the company locked them out of their accounts for no reason, stopping them from trading, investing or selling their funds, and even deleted accounts completely.
Coinbase users can store their cryptocurrencies in a digital “wallet,” as well as buy, sell, spend, and trade cryptocurrency. According to the claim, the company proclaims that it is “building the cryptoeconomy – a more fair, accessible, efficient, and transparent financial system enabled by crypto.” It also says that it is a regulated and fully compliant entity, registered with the United States Department of the Treasury’s Financial Crimes Enforcement Network as a Money Services Business.
However, the groups of cryptocurrency traders say that in reality the company prevents its users from accessing their accounts and funds for arbitrary reasons and arbitrary amounts of time, stopping them from investing, spending, saving, earning, and using, or even withdrawing their funds. The lack of access resulted in the group’s accounts losing value, the class action lawsuit alleges.
Leone, who had $15,000 in his account, was locked out of his account in January for no reason, and despite sending more than 100 emails he has never received a response from the company, the claim states. Treseder, who had $30,000 in his account, was locked out arbitrarily in January and has failed to regain access to his account despite numerous attempts. Reece deposited previously-owned cryptocurrency into his Coinbase account, and after making the deposit he logged into his account to find it had disappeared, according to the class action lawsuit. He is yet to access his funds.
Beavers says that he was locked out of his account after contesting a “mistaken” $100 fee. According to the claim, he has been locked out of his account for several months despite attempts to contact Coinbase and regain access. Ali has been locked out of his account since January for no reason, despite filing numerous complaints to Coinbase, the claim states. And Pinkey says that she has been locked out of her account, which had $6,000, since February and has not been able to regain access.
Those who were eventually able to access accounts found that the value of their cryptocurrency had dropped significantly in the interim and some had no ability to sell or use the cryptocurrency held in their Coinbase accounts, the class action lawsuit alleges.
“In some circumstances, Putative Class Members’ accounts were erased in their entirety,” the claim states.
“Further, Defendant failed to provide Putative Class Members any explanation for where their cryptocurrency went or any remedy to retrieve it, causing significant losses.”
The claim says that Coinbase’s actions have resulted in irreparable harm to the traders.
The traders want to represent anyone in the United States who was locked out of their Coinbase account. They are suing for negligence, unjust enrichment, breach of contract and fiduciary duty, conversion and violation of consumer laws. They seek certification of the Class, damages, disgorgement, injunctive relief, interest, legal fees, and a jury trial.
This isn’t the first class action lawsuit to hit the world of cryptocurrency. In January, Ripple was hit with a class action lawsuit alleging the illegal sale of cryptocurrency. The case was one of a number that came after the Securities and Exchange Commission lodged a legal action against the payment processing company.
Do you have a Coinbase account? Have you ever been locked out of that account for no reason? Tell us about your experience in the comments section!
The traders are represented by Kevin Mahoney, Katherine J. Odenbreit, and Nicole G. Blanco of Mahoney Law Group, APC.
The Coinbase Account Access Class Action Lawsuit is Leone, et al., v Coinbase, Inc. et al., Case No. 3:21-cv-04286 in the U.S. District Court Northern District of California.
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368 thoughts onCoinbase Randomly Locks Users Out of Accounts for Months, Deletes Funds, Class Action Lawsuit Alleges
Coinbase locked my account since December 2022. Coinbase refused to grant me access despite repeated requests
I was locked out today and so was my wife and my daughter. No reason, just said it was a security issue. It started when I moved larger amounts by wire
Early in May of 2023, I suspected that my personal computer had been hacked so I immediately changed passwords on all my credit cards and notified Coinbase to freeze activity on my account temporarily until I was comfortable about the possibility of an intrusion on my computer. Two weeks later, I asked to unfreeze my Coinbase account to give me access to my assets. The last time I had access, I had over $200,000 in my accounts . Before the big crash, I had over $500,000, They claim my I.D. is not legible (Michigan Driver’s license) and put me through their routine of pasting a photo of me holding my I>D>. Three times so far and today they informed me again that my recovery request has been cancelled. Locked out of my asset since May,2023
My funds have been on hold for 5 days from an ACH transfer. Then I completed a wire transfer as well as I was learning about the types of transfer processes. I am new to this world.
Well after the 5 days it turned to 7, then to a month. How on earth is this allowed. I don’t know any wallet or bank that does a month, lol. Absurd.
Here is what they said…
Thank you for your patiently waiting, Steven. Upon checking, here’s what I found. Please be advised that when you use a bank account to cash in funds or as a payment method for purchasing cryptocurrency, your funds will not be available immediately. This is a standard Coinbase policy for fraud prevention purposes to protect your account.
Your current hold for $2,000.00 will clear on 2023-08-22 by the end of the day (11:59 pm Pacific time).
Your current hold for $1,000.00 will clear on 2023-08-18 by the end of the day (11:59 pm Pacific time).
Your current hold for $2,000.00 will clear on 2023-08-18 by the end of the day (11:59 pm Pacific time).
Please be advised that you will be able to cash out or send your funds as you wish when the hold is removed.
If you would like to send funds off of Coinbase faster, and wish to reduce the likelihood of a withdrawal hold, you can use an alternate payment option such as: a wire transfer, debit card, paypal, or apple/google pay. But please be reminded that if there is already a hold in place, funds added during the hold window can be subject to the hold regardless of the payment method. Please note that the hold is on the fiat (USD) value, and not the crypto value.
Regarding the speed of the different payment methods, you can refer to this link:
Yeah so…
We shall see.
Mistakingly transferred/swapped money from ethereum 2 to their upcoming ethereum3 netowork with no possible way of retrieval after emailing and phone calls, they told me you’ll just have to wait for them to release the ethereum 3 network.. which is stupid. I don’t have time to wait for someone else, it’s my money, I want it back!
Been locked out since January 4 2023 tried to reopen account found $0 balance no help from support. I want in on this class action SIGN ME UP
SHAKILLA WESTBROCK
DEC 2019-JAN 2020 THESE ACCTS STARTED. ALSO had COINBASE ONE ACCT. got email IN JANUARY THEY transfer $100 into MY REGULAR COINBASE acct. AND TO CHECK THE TRANSFER,RESULTING NO TRANSACTION TOOK PLACE
I was just restricted from my account on coinbase. I filed a complaint and the response I got was we are sry that your your account has been restricted and we cannot lift the restriction and no no further reason or explanation was given. I am pursuing legal action for discrimination as it seems Coinbase is doing this to random people without explanation.
Hola buenos días mi nombre es Francisco René Quintanilla Díaz y tengo la billetera coinbase wallet,y me depositaron un dinero,pero no lo puedo transferir a mi cuenta, porque está bloqueado no sé si me pueden ayuar
Been locked out of my account for over a year. Have at least 1k in my account. I’ve reached out multiple times but I have not heard anything from Coinbase. I don’t understand how they can take advantage of people like this. I’d like to join this action.
Me too for the last few days I’m trying to go to my account blocked for no reason I have send them my 🆔 and pictures not working without any reason that not legal it’s our mistake to trust Coinbase but there is a god and lawyers I will not rest until I get my account back… crazy app
Coinbase locked me out in 2021 as well. I had mentioned to them I don’t recognize a certain bank on my account. Or something of that nature, but I let them know that, then immediately my account was marked for deletion. I don’t understand why, so I ask why can’t I buy and why my accounts been marked for deletion? Then get kept asking me to send my ID in, in multiple emails, I thought it was strange. I did so. however they kept my account marked for deletion and still won’t disclose any other information to me. I still wish I could have my account back!
Locked out of account for months– would like to join this action. No response from Coinbase, just a run around.