[ANN] Bitcoinica Consultancy abandons customers. Bitcoinica to enter Liquidation

[tseale]

It is August 2012 and 80 days have passed since Bitcoinica was taken offline following the Rackspace hack. Many of you have followed developments since that time with interest and frustration. The company's investors and I have also been extremely disappointed.

Donald Norman, Patrick Strateman and Amir Taaki accepted responsibility for Bitcoinica on April 24 as Bitcoinica Consultancy and have retained the -only- legal authority to act on behalf of the company. At this time it appears they have abandoned their legal duty.

They now refuse to reply to communication, refuse to acknowledge their responsibility, refuse to resign voluntarily, and refuse to act. In particular they have refused to do anything to recover stolen funds, even where the required action is as simple as providing a payment address. This is now hindering the efforts of others to minimize loss to Bitcoinica's customers.

Clearly, this must end.

Acting in its capacity as creditor to Bitcoinica LP, the Wendon Group investment fund will appoint a receiver under New Zealand law. This has been an option of last resort which is now unavoidable. Under receivership, a licensed and insured specialist will replace the Consultancy as the designated authority. Upon satisfaction of secured creditor interests, the company will proceed to liquidation in which remaining funds are distributed. Without Consultancy cooperation, this is the only ready way forward.

Wendon Group intends to donate any funds it obtains via receivership in favor of Bitcoinica customers. Complete liquidation will likely take place over a matter of months.

While this is not the outcome any hoped for, it is certainly an improvement over the deadlock resulting from Donald, Patrick and Amir's untimely abandonment.

Many have suffered because of the Bitcoinica disaster. Everyone is right to be upset. Since no one in charge has seen fit to offer an apology, let it be me instead. To all those affected, I'm very sorry.


Tihan Seale

[1713578285]

1713578285

[Mike Jones]

What is your position/job/role in this affair, Mr. Seale?

[BitBuster]

Time to rigorously boycott Intersango and the "Bitcoin Conference" then?


BB.

[kiba]

So you didn't get fired?

I hope this incident taught you not to store customers fund in a hot wallet and use 2 factor authentication.

[dancingnancy]

So what does this mean exactly?  What about the funds transferred to the lawyer?

[Coinabul]

Will customers get a payout, or will the funds being donated in favor of the customers go to some other organization, such as the Bitcoin foundation?

[disclaimer201]

Time to rigorously boycott Intersango and the "Bitcoin Conference" then?


BB.

That's a no-brainer. Of course you abandon both. Community has already split because of this ordeal.

_______________________________________________________________________________ ___________________
I am owed 44.21 Bitcoins by Bitcoinica. Please compensate or donate here: 1ET2ps7BRrZnDeq7bVNc8bS9ZmgN8DxUXy

Thank you.

[tseale]

What is your position in this affair, Mr. Seale?

I am an investment scout for Wendon Group. Part of my role is to monitor past investments.

I facilitated Bitcoinica Consultancy's take-over of Bitcoinica and made my knowledge of the business available to them.

Bitcoinica Consultancy had exclusive responsibility for Bitcoinica's daily operations in all respects, including hot wallet management.

[apetersson]

It would be very sad if that happens. The Conference should not be about Bitcoinica, Intersango, or any other particular player. It is about bringing the community together, listening to great speakers and hear about new ideas. Just take a look at the confirmed speaker list. I am definitely coming and it will be a great event-no matter who organizes it.

Time to rigorously boycott Intersango and the "Bitcoin Conference" then?
BB.

That's a no-brainer. Of course you abandon both. Community has already split because of this ordeal.

[Mike Jones]

What is your position in this affair, Mr. Seale?

I am an investment scout for Wendon Group and other funds. Part of my role is to monitor past investments.

I facilitated Bitcoinica Consultancy's take-over of Bitcoinica and made my knowledge of the business available to them.

Bitcoinica Consultancy had exclusive responsibility for Bitcoinica's daily operations in all respects, including hot wallet management.

I'd like to thank your company for taking the initiative then. Give my compliments to the chief.

[sarpar]

@Tihan
Where I am from delayed filing of insolvency is a criminal act. Will you as creditor conduct a report to law enforcement for us?

@All
The consultancy team failed and harmed a large fraction of the Bitcoin community. I ask you all to boycott all their ongoing ventures e.g. Intersango, the London Bitcoin conference, personal trades, open source projects etc.

[Phinnaeus Gage]

Tihan Seale, would you be so kind as to give this community a detail online of what transpired at that hotel lobby between you and Zhou Tong, aka, Kevin Lim, when the handover of Bitcoinica occurred?

~Bruno~

[kiba]

Bitcoinica Consultancy had exclusive responsibility for Bitcoinica's daily operations in all respects, including hot wallet management.

Don't care.

Whoever hold the funds is responsible for it, period. I don't care if you didn't talk to or wasn't informed by the company. If you're messing around with a startup in a startup currency, you should at least understand what the fuck you're doing, including knowing how to reasonably secure this newfanged internet money.

At least you're willing to take responsiblity and do things that the bitcoinica consultancy refuse to do so that we can put this fiasco behind us.

[kiba]

@All
The consultancy team failed and harmed a large fraction of the Bitcoin community. I ask you all to boycott all their ongoing ventures e.g. Intersango, the London Bitcoin conference, personal trades, open source projects etc.

The bitcoin team isn't going to simply oppose their source code contribution to the project. Doing so is quite self-harming. Given that the conference is a big chance for the bitcoin community to get together and build business tie and relationship, so to deny going there is self harming.

Intersango is a bitcoin exchange among many, so boycotting it doesn't cause much self-harm. We just use mtgox instead.

[MemoryDealers]

The short version is that:

Amir, Patrick and Donald of Intersango have all made this problem MUCH MUCH WORSE by refusing to act or even reply to emails.
Because of those three, everyone who had money in Bitcoinca will receive back less money than they would have, had they been cooperative.

They should be ashamed.

[teek]

The short version is that:

Amir, Patrick and Donald of Intersango have all made this problem MUCH MUCH WORSE by refusing to act or even reply to emails.
Because of those three, everyone who had money in Bitcoinca will receive back less money than they would have, had they been cooperative.

They should be ashamed.

I don't understand why this has to be the case, I really don't.  It's like nevermind the mistakes they or zhou made.  They went and took this whole "moral high ground" stance, and now everyone is likely getting fucked.

Also - how the liquidator handles BTC assets is going to be interesting, likely in a way that doesn't benefit any of us.

[ninjarobot]

Wendon Group intends to donate any funds it obtains via receivership in favor of Bitcoinica customers.

Thank you for acting with integrity.

Please make sure the reimbursement database managed by the Bitcoin Consultancy guys is secured so the liquidator has records of verified customers and previous payouts. We really don't need another wipe at this point.

[tseale]

@Tihan
Where I am from delayed filing of insolvency is a criminal act. Will you as creditor conduct a report to law enforcement for us?

There will be legal action against Consultancy members for applicable acts of civil and criminal wrongdoing.

[Vod]

@Tihan
Where I am from delayed filing of insolvency is a criminal act. Will you as creditor conduct a report to law enforcement for us?

There will be legal action against Consultancy members for applicable acts of civil and criminal wrongdoing.

I doubt that.  People don't even want legal action against the thief that started all this. 

[terrytibbs]

Tihan Seales the deal, as always.