Consumer complaint received 2022-08-14
Company: Coinbase, Inc.
State: IL
Product: Money transfer, virtual currency, or money service
Sub-product: Virtual currency
Issue: Fraud or scam

Complaint:
I'm a victim of financial crime which costs my lifetime saving of ~ {$280000.00}. I was cheated to send the money in my Coinbase account to a fraud address ( in 3 transactions below ) and failed to get it back. The police report # is XXXX from city of XXXX, IL. 

On XX/XX/2022, {$980.00} was sent out to a fraud address ; On XX/XX/2022, {$74000.00} was sent out to a fraud address ; On XX/XX/2022, {$200000.00} was sent out to a fraud address ; I called Coinbase around XXXX XX/XX/2022. Coinbase refused to compensate my loss and said " All cryptocurrency transactions that are confirmed on the blockchain are irreversible. Coinbase has no information on ownership of external cryptocurrency addresses, and because this is an external process, there is no way for Coinbase to cancel, reverse, or recover these funds on your behalf. '' 1.However, Coinbase did not warn me when I typed in fraud address to send. Coinbase 's fault attracts, helps and enables criminals to use Coinbase to commit crime. Coinbase should compensate its customer 's loss caused by its fault. 

2.Coinbase said ( https : //cryptochronicle.io/coinbase-refund-if-hacked/ ) : " Coinbase secures the majority of its digital assets with crime insurance, and will refund you if your account has been compromised. Even if your funds were lost due to negligence or personal error, they might still refund your account. '' The insurance covers " Wrong crypto address : Another common mistake people report is sending money or cryptocurrency to the wrong recipient address. '' Therefore, Coinbase should compensate my loss. 

3.Coinbase said ( https : //help.coinbase.com/en/coinbase/other-topics/legal-policies/how-is-coinbase-insured ) : '' Coinbase carries crime insurance... However, our policy does not cover any losses resulting from unauthorized access to your personal Coinbase or Coinbase Pro account ( s ) due to a breach or loss of your credentials. '' Coinbase lists the only exclusion above, which does not apply to my case. Therefore, Coinbase should compensate my loss. 

I complained to XXXX  on XX/XX/2022 ( ID # XXXX ). The communication history with Coinbase is attached. There is no response from Coinbase about following facts. Coinbase pretends not seeing them. However, those facts are still there. Fair third party saw or will see them. 

Fact 1 : Coinbase did not warn me when I typed in fraud address to send. Coinbase 's fault attracts, helps and enables criminals to use Coinbase to commit crime. I point out Coinbase fault multiple times. Coinbase keeps silent on its fault. Coinbase does not deny its fault. Therefore, Coinbase should compensate damage caused by its fault. 

Fact 2 : I point out that Coinbase has crime insurance multiple times. Coinbase keeps silent about the insurance. Coinbase does not deny that it has the insurance. Why can not Coinbase use the insurance to compensate customer 's loss? 

On XX/XX/2022, XXXX recommended me to escalate to regulatory agencies, including Consumer Financial Protection Bureau. Thank you.

Company response to consumer: Closed with explanation