If there are issues with a trade and it cannot be properly cancelled or finished you can start a dispute. It’s possible to initiate a dispute only for trades where escrow protection has been enabled. Escrow is always enabled for all online advertisements. Once the dispute has been initiated a LocalBitcoins support person is notified and will resolve the dispute.
Disputes are always specific to a trade where you are an involved party.
If you are buying Bitcoins online, you can start the dispute after 6 hours
if you have marked the payment completed.
If you are selling Bitcoins online, you can start the dispute after 6 hours
. If the buyer is a new user with less than 3 trades you can open a dispute in 1 hour.
After the payment window ends a 'Start dispute’ button appears on the contact page.
A dispute can no longer be started if the Bitcoins have been released from escrow. The Bitcoin seller should never release escrow if the payment has not cleared. Transferring Bitcoins outside escrow is risky: LocalBitcoins.com support cannot return Bitcoins released from escrow.
If the dispute parties have verified SMS number, they will receive a SMS notification when a dispute is initiated.
In many cases of unresponsive trade party this will alert the party that immediate action is needed. Examples when a dispute should be started:
- The Bitcoin buyer claims they have paid even if the Bitcoin seller has not received the money. It might be that the transaction simply takes longer than usual.
- The Bitcoin buyer is not responsive, Mark payment button has been pressed. The seller's Bitcoins are held in escrow. The LocalBitcoins support team will manually check the case for potential abuse, and cancel the escrow if appropriate.
- There are issues with the payment: the bank account is temporarily frozen due to money laundering and fraud checks. This may happen even if the transfer is legitimate, as sometimes local regulation enforcement causes banks to do this.