Topic: BlockFi (BlockFi.com) locked my account with $25,000 inside (Read 195 times)

The Wall Street Journal reports that according to their information, the BlockFi cryptolanding platform is preparing to file for bankruptcy in accordance with Chapter 11 of the US bankruptcy code. Earlier on November 11, BlockFi suspended the withdrawal of funds and recommended that users refrain from making deposits.

Source: https://www.wsj.com/articles/blockfi-prepares-for-potential-bankruptcy-as-crypto-contagion-spreads-11668534824?mod=latest_headlines
Archive: https://archive.ph/9aFui

Erdogan - Everything that has been written here makes up the story that the money you transferred from your bank to BlockFi.com comes from an illegal source (most likely money laundering). The bank probably referred the case to the prosecutor's office or court. When the case is resolved and closed, you should receive a letter from the court with detailed information. If all is well, you will send a letter to BlockFi and get your money back. If you do not know anything about it, it is best to write a letter to the bank and find out what the situation is.


- Yes, based on their actions it might seem that way. But that's just a message they probably send to every user when they close an account. If you check Reddit or Google you will see that there are many others in the exact same situation as mine.

You will also see that a few settlement legal actions against BlockFi have started by the Securities Division in the Mississippi Secretary of State's office, as well as the U.S. Securities and Exchange Commission + New Jersey Division of Consumer Affairs, and so on.

P.S. The request for the court order did not come from the bank, but from BlockFi. The bank just stopped my financial operations through their accounts, that being a decision I had even thought about, even before I asked for the transfers recall, but I still tried to get my money back from BlockFi in that way, but it obviously ended badly for me..

Erdogan - Permanent blocking of accounts by banks is not without a reason. You should get an explanation in the document from the bank. I'm surprised you don't know what is causing these blockages and you haven't even tried to find out.

- I don't know whether or not you are familiar with the methods that banks apply in the United States, but it is a very common case for anyone to find out that they have just closed a bank account, either with a lot of money in the balance or even empty.
There are far too many reasons why something like this can happen, and that's why I will not try to present them now, since I'm not an expert, but it happens on a daily basis. Just a basic Google search will confirm what I just said.

But in my case, the reason the bank made this decision is because I followed BlockFi's advice and asked the bank to return the bank transfers processed weeks before, without any strong/legal reason, other than the BlockFi's advice. Of course the bank considered my request suspicious, probably even an attempt of fraud against BlockFi.
Since the bank could not verify if I received the services or products offered by BlockFi in exchange of the money I sent, they made a business decision by handing me the money I had in my bank accounts and they stopped offering me further services.

Again, this is a very common scenario in the United States. Of course I have the legal right to appeal their decision, but that will take a very long time.

Erdogan - This is a common practice used by casinos. I am sure their terms of service says that you will be asked for verification at the time of your withdrawal request.

- No details are specified in the TOS about any verification at the time of withdrawal.

But you can find this:  "As a regulated financial service company operating in the United States and Bermuda, we are required to identify clients on our platform ... something that is necessary for us to be able to continue to offer digital currency services to our clients  .... You hereby authorize us, or a third-party service provider that we designate, to take any measures that we consider necessary to confirm the personal information you provide, verify and authenticate your personal information, and take any action we deem necessary based on the results. You acknowledge that this process may result in a delay in registering your BlockFi Account, and that you may not be authorized to access or use your BlockFi Account until your registration has been successfully completed."

Doesn't that mean that to be able to use BlockFi, or to get a valid account with BlockFi, or to be able to deposit money or to be able to place buy or trade positions, I should be fully verified? And if I'm not wrong, this is a general rule for any CEX operating within the US?

If my account had been unverified, I wouldn't have been able to deposit any money, right?

But that's not the problem, because they checked on me before my account to be approved by the method presented above, and 2 more times through the external ID + Selfie verification service, right after my withdrawal requests.

They didn't make it clear why they blocked my account, or if there was any problem with my ID documents. Neither did they ask for any other documents, nor did they present any option for a mediation so I can get my money back.

BitMaxz -   What kind of ID did you submit when KYC verification?

 -  I provided VALID, UNEXPIRED, ID's. Their verification process is the same as with any other CEX. Through an identity verification service (third party).
 I got the Verified badge, TWICE. The problem with BlockFi is that they are asking for the same verification over and over again for every withdrawal request.
 Also they are asking for ID verification only for withdrawal. When opening the account they will process a verification in background based on Social Security number, personal info and so on. I'm talking about an United States based account. I don't know if that's the process for any account of an American citizen, but that's the way it was in my case.



          

This is a common practice used by casinos. I am sure their terms of service says that you will be asked for verification at the time of your withdrawal request.


Permanent blocking of accounts by banks is not without a reason. You should get an explanation in the document from the bank. I'm surprised you don't know what is causing these blockages and you haven't even tried to find out.


Everything that has been written here makes up the story that the money you transferred from your bank to BlockFi.com comes from an illegal source (most likely money laundering). The bank probably referred the case to the prosecutor's office or court. When the case is resolved and closed, you should receive a letter from the court with detailed information. If all is well, you will send a letter to BlockFi and get your money back. If you do not know anything about it, it is best to write a letter to the bank and find out what the situation is.

But sincerely, if someone submitted the wrong type documents that are not required for verification, why would they just lock the account without giving any explanation. I have unsuccessfully tried to verify with some exchanges, but they would state the reason why my verification was rejected via email. For BlockFi, they just went mute... All they want is a court order in order to process the refund.

What kind of ID did you submit when KYC verification?
According to them they do not accept these IDs below


If you are living in the US they accept only these two IDs State-issued IDs (Driver's License or Identification Card) and US Passport
Outside of the US country, they accept Government-issued photo IDs, National Identity Card, and Passport.

You might be submitted an unacceptable ID that is why they do ask again for KYC verification.
I believe it will take a while to solve this case better use the link that I posted above and start to call them for complaints since they already said they will only release the funds until they receive court order.

You can use imgur or imgbb to upload your screenshots and include the image url in your first post or reply.

Thought the same, but people are engaged with the good marketing strategy/ads, wording, promises of these platforms that's why people even non-newbies are fooled with it hoping that their funds is safe there and will gain much profit not knowing that most of these platforms will push you to your limit to fight with their "legal documents requirements" many custodial wallets or exchange use this kind of scheme actually.

Thank you for the advise. I will surely do that next time.

You can follow some guidelines from the so many posts around such as this one - https://bitcointalksearch.org/topic/m.58898862

Sorry, How I wish you used other more popular options like Kraken, Coinbase, Binance, FTX etc. Am not saying they can not lock your account if anything happened, but I don't think they would have treated you the way a less popular BlockFi did.

You could also use p2p exchanges like Hodlhodl, localcryptos.com to purchase your Bitcoins which you can later use to buy the altcoins you need.

That was my intention. I purchased Bitcoin and couple of other coins via BlockFi, but when I tried to withdraw my coins, they locked my account.

I have always told people avoid these stupid custodial staking and DEFI platforms, but very few understand. This is one of the main dangers of such platforms. You are literary handing your money over to them for just a small APY.

Imagine risking $25,000 for just a 10% APY. That approximately $2,500 after 1 year 

Why not just buy Bitcoin, keep it in your noncustodial wallet or hardware wallet, sit down and wait for a far much higher profit while all that time, the Bitcoins are under your control?
Bitcoin can make 10% in a matter of days if trades are well executed.

BlockFi seems a site where you can deposit and earn from staking and be able to trade.
That is why I don't want to use a platform like this because it's very risky it is just like an investment site and we know most of them are scam.
I search a bit about this but no one yet says that this site is a scam for me, it's very risky to deposit on such a platform.

It was discussed here on the forum already here https://bitcointalksearch.org/topic/blockfi-5351146

If you have a problem with them you can call them directly check this link below.

- https://blockfi.com/disclosures-and-complaints/

I Hope the list of customer support from the link above can help you with your complaints contacting directly through call can speed up the process than waiting for their email.

I can add some screenshots. That's not a problem. Just let me know please how I can add photos to my posts here.

I saw also a post asking me to post to Reddit. Of course I did, and they contacted me but their final answer is: "Any funds on the account will remain locked until BlockFi receives a court order to refund the funds".
I don't know how legal it is for them to hold the money for an indefinite period of time without offering any refund option. Via their Terms page, a situation like this is not clearly specified. I cannot find information about what happens to a blocked account, or any information that specifies that there may be the possibility for a court order to get the money back. But it says clearly that to allow you to place trading positions on their platform, you need to be checked beforehand. Their only argument for keeping my money locked up is that they couldn't verify me. As I said above I have been checked several times. And if they couldn't verify me, how could I repeatedly deposit money and buy Cryptocurrency??? It makes no sense, right?

By the way: Check on this (based on their Terms): "Please note that no technology can be considered completely secure or impenetrable and internet protocols and other public and/or proprietary technology used or accessed by the Online Platform may be vulnerable to exploitation or compromise by persons engaged in hacking or criminal conduct. Subject to applicable law, BlockFi shall have no liability to you for any such exploitation or criminal conduct by third parties"  - That means they won't take any responsibility if a hack occurs in their system. If a hacker manages to access BlockFi's platform, forget about your money...

Maybe you can add some screenshots of the emails and etc for proofs.

And the h*ll is that amount sending to such service. First locking your account for no reason and you need to wait for 60 days is really susp asf. Is your bank prohibits the use of crypto-related transfer? And whats the reason of your bank closing your account?

Your really option is to file a case report for this, Idk how much it will cost in your area buy if you can have such amount there i guess you can afford it as well.

Hello,
BlockFi.com locked my account with $25,000 inside, around 80 days ago, and they are not willing to process a refund. They are asking for a court order just for them to process a refund.

After seeing a bunch of info about the products BlockFi offers that seemed attractive at first glance, I decided to open an account. Within minutes the account was ready to take the money out from my bank. No photo identification required, by the way.
I started depositing money, and seemed easy compared to other services of this kind.

After a while, I thought it would be a good idea to secure some funds by processing two Crypto withdrawal requests.
I've been waiting for two days (the minimum waiting time offered for a Crypto withdrawal), but instead of processing my requests they asked me for verification via ID/Passport, photos/video using my phone..(a regular request of any CEX), but what's strange, it's that they will ask for Verification after they allow you to deposit large amounts of money, and not before, as any other service does. I wonder what would happen with your money in a strange scenario where (for some reason) you can't successfully pass the Verification.

But... that was Ok. I successfully processed the verification within minutes.
Then, surprise..... Because I had two pending withdrawal requests for two different Crypto coins, even if one of them was for a very small amount being executed just for me to understand their withdrawal process, BlockFi asked me to get Verified once again. Not a different Verification process. Just the same one I had successfully executed minutes ago.

No problem! I did it again "You're all set !".
Within minutes, I got an email notifying that my BlockFi account was locked. No explanation other than asking to read their TOS, and the following notice..... "Should you be unable to retrieve funds through your bank, you must wait 60 days from receipt of this email before requesting a manual wire withdrawal to the source bank account. Please note that we may require identity verification to process the withdrawal. Note: Any requests made to BlockFi about your account funds will be ignored until we can process a return of funds which will only be eligible after 60 days. Do not reach out to BlockFi until after this date. "

The 60 days have passed and even though I used every possible method to contact BlockFi, it doesn't seem like anyone's going to reply. (Several support tickets or by sending any kind of message using any possible form on their Help/Support pages, trying to call them using the phone number listed over their Help page, sending message via some of the previous support tickets that were used around two months ago to communicate with them..and more..

Let's not forget that a considerable amount of money is still with BlockFi, and my account is still blocked.

If that can't be called an extremely frustrating situation, I'm curious to hear another .

--------- UPDATE
Finally I've been contacted, being informed that they will return my money...soon.

This is definitely good news, but ... I still find myself in a "strange" situation.

Let me explain: When BlockFi locked my account they said: "At this time, we are not able to return any funds to you directly. We’d recommend that you contact your bank and request that any ACH transfers you made to your BlockFi account be canceled and reversed. Should you be unable to retrieve funds through your bank, you must wait 60 days from receipt of this email before requesting a manual wire withdrawal to the source bank account. "

I thought it would be faster to follow BlockFi's advice by asking the bank to proceed as per their instructions,but a nightmare was about to start.
Shortly after asking the bank to return transfers made by me (no scam or hack involved), they decided that something is not right, ending by closing my bank accounts. PERMANENTLY.
So BlockFi will not be able to send a Wire Transfer as it will be automatically returned.
But when they blocked my account, part of the money was in Crypto balances. I wonder what are the terms used to close my positions. Crypto coins rates have changed in the past 70 days. Maybe they will process my original withdrawal requests via crypto? Or will they accept my request to send my money to another bank account in my name? Also I wonder how they could have sent a Wire Transfer to an account that does not accept wires (if they were sent to BlockFi from a NeoBank). Not the case here, but just wonder...

--- UPDATE

BlockFi's final word is: "Any funds on the account will remain locked until BlockFi receives a court order to refund the funds"
$25,000 of my money are locked and they also refuse a refund to the source bank account