Coinbase Confirms Mistakenly Overcharging Users and Draining Bank Accounts

What seemed to be a typical Reddit post sparked a trail of other posts on a variety of social media platforms all claiming that the cryptocurrency exchange Coinbase overcharged users' accounts. Several of these complaints included people who found their banking accounts completely drained. 

One user posted that they'd used Coinbase to buy Bitcoin, Ether, and Litecoin for just $300 on February 9. Days later, those transactions came through five times, putting the poster out of over $1,500. 

"My bank account went from very comfortable to negatives balance, not to mention extra $5 charges, and overdraft fees,” the user wrote. “As a result my rent check bounced, and my bank went further into negative for a NSF charge for $25. My landlord is not a nice person and is on my CASE and I have nothing to offer him. I am FREAKING OUT."

"You drained my bank account and now I have nothing," reads one post from this morning.  

"Welp officially broke," reads another, "charged 17x1000$ on my account."

"FREAKING OUT," posts another user. "Coinbase drained my bank account. Took 5x the amount I authorized from debit. I am now broke, cannot afford rent, food, gas, bills."

Coinbase noticed the growing online traction and addressed the issue as soon as they could.

"We are actively investigating some reports from our customers about unexpected credit or debit card charges appearing on their statements from previous Coinbase purchases," a staff announcement explained. "We can confirm that the unexpected charges are originating from our payment processing network, and are related to charges from previous purchases. To the best of our knowledge, these unexpected charges are not permanent and are in the process of being refunded."

2/ We have identified a solution and any future purchases will not be affected by this issue. We will ensure any customer affected by this issue is fully refunded for any incorrect charge. We expect this to happen for customers automatically through their bank.

— Coinbase (@coinbase) February 15, 2018

The issue even affected Coinbase employees. One employee also took to Reddit to vent about "the unexpected charges are originating outside of our control, and are related to charges from previous purchases."

Coinbase is telling anyone potentially affected by the issue to contact customer support as quickly as possible at support.coinbase.com. 

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"We will be reviewing all card transactions from the last few weeks to ensure any customers affected are notified," the company said via Twitter. "We will post on Twitter and our blog with further updates. If you suspect you were incorrectly charged, please contact your bank or card issuer and ask about the charges. After that, please contact Coinbase support."

While bitcoin and crypto-related finances have become seemingly riskier in terms of draining money, few anticipated issues like this and especially not with an organization like Coinbank. However, the company has been busy as of late. They temporarily stopped their PayPal withdrawals. They also stopped adding new credit cards for payments to US customers. And they also launched a new tool for merchants.