A Coinbase user is suing the exchange to recover 90% of his life savings that he says was stolen from him, lawsuit claims. The user said Coinbase won’t reimburse him and it sees the breach as his problem. But the exchange ignored several red flags for fraud, he alleges in his claim for triple damages.
Coinbase is being sued after allegedly telling a man who said he lost $96,000 on its site to theft that it wasn’t the company’s problem. In a lawsuit filed on Monday in San Francisco federal court, plaintiff Jared Ferguson detailed how he contacted Coinbase for help after discovering that most of his life savings had been funneled out of his account on the crypto company’s platform.
According to the filing, which was first, Ferguson alleged he was texted by his cell provider in May, with the message referring to a SIM card change request that he had not submitted. He restored service to his phone the following day, the lawsuit said—only to find that almost all of his life savings had been wiped out of his Coinbase account.
Ferguson said his account had been emptied in mere hours after being accessed by a new device and from an IP address that had never been associated with his account. In the court documents, Ferguson argued that Coinbase was responsible for unauthorized withdrawals from user accounts under both state and federal laws. However, according to Ferguson, the company refused to reimburse him for the lost funds.
Please note you are solely responsible for the security of your email, your passwords, your 2FA codes, and your devices,” Coinbase allegedly told Ferguson in an email. He argued that the company’s response to the alleged theft “disclaimed any responsibility for the hacking of its customers’ accounts,” and that its security practices fail to notice and stop “obviously fraudulent” transactions.
“Coinbase’s willful blindness to the multiple fraudulent badges contained herein constituted bad faith acceptance of unauthorized payment orders,” the lawsuit states.
This is not the first time Coinbase has seen complaints from customers who lost money in their accounts in a SIM swap scam. An Indiana man lost $7,200 from his account in 2021 but failed to get his money back, CBS reported, adding that it had been reporting on a similar Coinbase hack for months. Coinbase did not respond to Insider’s request for comment. Ferguson is seeking a full refund along with triple damages including interest, statutory and punitive damages.
