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Simon's operation was closed due to "suspicion of fraud" not ml, " Ladies and Gentlemen, regarding your question, I would like to inform that due www.bitcoins-24.de not the Bremen authorities, but law enforcement authorities in Berlin are responsible for the facts in the investigation. The investigation on suspicion of fraud will be conducted at the StA Berlin under number 241 Js 380/13. I ask relevant questions thus jurisdictional convenience to be sent to the local authority in Berlin. " therefore there maybe still a chance for fraud charges to be dropped and maybe continue the operation, or just let everybody get their money out. Nope. There was an older investigation, under number 290 JS 47630/12, that was actually the cause for freezing and impounding his accounts. It had gone on for some time already (at least early March) and was for suspicion of money laundering. The 241 Js 380/13 fraud cause started much later, probably after bitcoin24 was closed by Simon. Both investigations are now bundled in Berlin, so its correct that Bremen authorities dont have anything to do with it anymore. I had posted a rough estimate of the timeline earlier ( https://bitcointalk.org/index.php?topic=174600.msg1877068#msg1877068). |
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the irony of that is that we the customers can't now get our deposits now because of this seizure of hardware and closure of bank accounts. Something that this seizure was apparently supposed to avoid!
So it's the banks and authorities and not Simon who are preventing us from doing what they accused Simon of preventing us from doing.
Depends. In retrospect it looks like Simon was running his business in violation of european regulations for the prevention of money lending (and financing of terrorism). As posted multiple times in this forum, running such an exchange he needs to verify the identity of at least significant customers (if not all) and needs to report any transactions above 15k euro as well as suspicious transactions at any volume (if someone withdraws 1000 euro 100 times or whatever). In addition he needs to be able to answer questions regarding who is the legal responsible for any customer account at any time. With no ID verification in place, all of the above doesnt work. If any money laundering then happens (as it seems it did, e.g. from phished bank accounts), as he can not identify who did the trading the dirt sticks to him, as unwitting accomplice due to neglect of precautions. Simon somehow managed to fly under the radar for some time, but this first set of accusations is already more then enough to close the business, impound all accounts and worst case sentence the manager to up to 2 years of jail time. So it is certainly Simon's business practice and neglect that caused all this, and he is responsible for running bitcoin24 in an illegal way.Blaming authorities or banks for closing down illegal business is a tad naive, sorry. I wonder about this seizure of hardware... surely the hardware was installed in a secure area at a data centre, not located in his own business office? Couldn't be that easy to simply seize?
At least last year he seems to have had his stuff on virtual machinse on rented servers somewhere (evident from his him asking in a forum how to restore deleted files on such a virtual server, as he lost a bitcoin wallet to wiping one server without having backups last year). How exactly everything is set up and whether it requires physical access to one of his own physical computers (for keys or whatever), no idea. Naively I would agree and say shouldn't be needed and thus hard to seize. On the other hand if he allows any withdrawals, thats continued support of money laundering, as he still cannot identify customers of course. That would remove the "unwitting" from the accusation making it infinitely more serious. |
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Ok, reading the scans of documents on bitcoin-24.com again (german), the legal situation looks a bit more complicated than just one accusation.
Money laundering:
According to the documents the bank where the German account is, Commerzbank, had asked the polish bank about a number of transactions.
These transaction were from german bank accounts that fell for fishing attacks and onto the Commerzbank account. Simon then transfered funds to his polish account.
On March 5th the polish bank answered a request regarding details of these transactions, a full months before the drama started.
On April 9th his polish account was frozen. I couldnt find the actual date when the german account was impounded, but April 9th is before the big market fluctuations and days before bitcoin24 went offline.
As a comment on this, according to European laws on money laundering (which are in effect in Germany) as Simon was operating a currency exchange he had to make sure that he can answer at any point questions regarding people having deposited money with him. This is the reason e.g. Mtgox has the requirement for ID verification before one can do substantial transactions in fiat.
According to the laws, if there is any money laundering going on (which Simon cant know as he doesnt have any dependable information on users identities) he makes himself an accomplice to the money laundering as he did not take sufficient measures to try to prevent it.
Converting fiat from phished accounts to bitcoin is money laundering, so some certainly happened.
Even an unwitting accomplice to money laundering, who frivolously failed to notice the money laundering (e.g. insufficient precautions) , can be sentenced to up to two years of prison time (!).
So in contrast to what Simon said a bit ago, he is certainly responsible, for operating a platform that could easily be used for money laundering.
Three days after the polish account was blocked (!) bitcoin24.com went down. During the big trading hype Simon already knew that his main business account is blocked.
Probably after the site went down another investigation was started, this time for fraud, accusing him of trying to run off with his customers money. This accusation seems to be at least partly based on his potentially careless and regular use of the Commerzbank account to withdraw cash, and also at least partly probably on his closing the platform and hence denying the users any access to their BTC and fiat.
Some news media report that he supposedly tried to withdraw a large amount from his Commerzbank account. That could be either:
- trying to run off with it or
- knowing that the account will be frozen soon (the polish one already was), trying to get some of his customers fiat to safety
Maybe the attempted big withdraw didnt happen at all, didnt find a good source.
The search warrant basically also states that they accuse him of, since sometime in March, not being willing and able to pay back all his customers deposits anymore.
The second accusation could be just a fuck-up of the way he dealt with the trading engine problem, though from reading his posts he might have been a bit careless in doing regular cash withdraws from the Commerzbank accounts (which doesnt really help to dissuade authorities from thinking about money laundering and/or fraud).
The first one is rather serious, as many people have noticed already, as he certainly did not operate bitcoin24 according to european regulations, and might thus be an unwitting accomplice to money laundering, which is still a very serious offense.
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thanks a lot for the time and effort
Youre welcome! Just thought, as people were repeatedly asking Simon to post in German before, as someone can surely quickly translate to result in something more legible than his english posts, that if there is no other someone in time, it might as well be me  |
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Also, on bitcoin24-help, an unofficial translation (by some other helpful user, thanks!) of a search warrant from the police can be found: http://board.btc24-help.com/viewtopic.php?f=3&t=40Very interesting, as is Simons post. It looks like they really think he would have run away with the fiat when the platform closed and accuse him of embezzlement. |
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Ok, here we go. Short warning, if you think Simons english is a bit incoherent, the German isnt really much better. Hes probably just really stressed out/on the edge and also not used to writing public announcements (no clear structure or consistent train of thought). My translation isnt very literal at places, as its easier for me to write semi-fine english sentences than to translate slightly garbled german literally into english. If the english is still garbled, its usually not my fault  , but the german being sloppy/ambiguous. Disclaimer: I ALSO DONT CLAIM ACCURACY OF THIS UNOFFICIAL TRANSLATION, of course. I am trying to be as accurate as possible, as some wording used is very sensitive to interpretation, but I am just some user trying to help, you know how to take that.
We are already a small step further.
The biggest problem is that whatever I publish is depicted as "fake".
Things that are a very serious topic, are one the other hand somehow ridiculous.
Why was there a need for an account at Commerzbank?
There were issues with "Sofortueberweisung", hence I added the Giropay option to Bitcoin-24 and Giropay required a german account.
My bank counselor at Commerzbank was informed in detail about the plans for the account and the expected business volume.
So the Commerzbank account was used as the german one required by Giropay.
Why was the polish account frozen?
The polish account was frozen as the criminal investigation department of the Bremen police requested legal and administrative cooperation.
The polish administration did not file any charges against me on their own, and why should they?
The polish administration simply heard the words "money laundering and terrorist financing" and froze the account.
A formal objection was filed against the freezing of the account on April 16.
Who or what is behind all this, and what are the reasons?
The reason is serious as well as ridiculous! So ridiculous that some might think its a joke:
The Commerzbank in Bremen reported to the police that I often did cash transactions. I am perfectly well entitled to withdraw cash, and I think you know that many people supporting bitcoin dont really trust financial institutions.
The cash transactions have NOTHING AT ALL to do with customer deposits. I assure you of that!
It was always either profit from fees of "Same-Day" bank transfer, from parcels or from donations.
Now the situation is that the Commerzbank account only got payments from Giropay. These payments belong to the business, but I withdrew the above profits from the Commerzbank account nonetheless. As already said this is not illegal and I am perfectly entitled to do so.
The Commerzbank is now accusing me of the following:
[...] he intends to have at his disposal, in cash and for his own ends, the sums of money transfered via Giropay to his account at Commerzbank Bremen from his customers to buy and trade with Bitcoins [...]
This is in no way correct, as ALSO a large part of the customer account deposits are at Commerzbank.
The Commerzbank now reported this "practice" to the criminal investigation department Bremen, who then impounded the Commerzbank account. Including a large part of customer account deposits.
What is the current situation:
As mentioned above, a formal objection was filed against the freezing of the polish account, as there was no reason for this.
Against the Commerzbank a lawsuit is being filed, as they caused very high damage.
1. The blocking of the account in Poland 2. The blocking of the account in Germany 3. My inability to act/do business as director of BTC24 Limited.
People, what are you thinking of me? That I am on some island, driving a fat car and having a life of leisure?
NO! My life is exactly as before and will certainly do NOTHING to the customer deposits!
Of course, non-profit and everything! But the "Same-Day" bank transfers, of which there were about 20 per day with a fee of 1%, are creating enough profit from the trading platform!
I wanted to create something where people can trade with bitcoins. I managed to do that. But then they try to take this away from me and destroy it by blocking my accounts!
As sorry as I am for everyone, its basically really not my fault! I used two different accounts, where both banks knew what I am doing and what business volume would register on the accounts.
Despite all the "Where is Simon Hausdorf" business I will not go into hiding and I am standing openly by what happened and how things proceed. But for this its required that the users/you believe me.
For real! If I had wanted to play you for a sucker, why am I writing this and why didnt I walk off with the 5 Million? Ok, maybe because I cant access the money, but wouldnt I have been able to do this much earlier? People, the money doesn't interest me at all! My motivation is really different.
The clerks/officers dont even care for me telling them that I cant conduct my business due to the account blocking, and that with certainty there will be some lawsuits being filed against my company.
Lawsuits also means even more problem with the police and the public prosecution department.
They simply dont understand how it is possible to have such a high business volume in such a short amount of time.
The money is and always was on these accounts and I NEVER touched it! All payments are documented/traceable and there were no problems ever to process withdrawals, apart from at the end, for the reasons given above!
Edit: Small hint, stop doing stuff like the Facebook groups.
1. Its dissimulation
2. Violation of copyright of some images
3. There are a number of threats
4. Its like a witch-hunt / as well as death threats
5. Charges were filed against Thomas Staegle
Personally I sort of believe Simon that its no scam, but I am not entirely sure whether his withdrawals from the account were legit and they DO accuse him of embezzlement. I am no expert on business practices and dont know exactly how the account was set up, so no idea whether the practices described by him are ok. |
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here is an update from btc24-help.com
it is in german.
he is basically blaming the german authorities for the mess. he is not walking away, has no interest in all this money. he is getting scared by death threats. he will sue people that threaten his life.
Commerzbank / Statement
by TAiS46 » Thu Apr 18, 2013 12:25 am
Wir sind bereits einen kleinen Schritt weiter.
......
Is there any english translation yet? If not I can try to do a quick one sometime this afternoon (if work allows). [as its a bit of work just want to make sure I didnt overlook an existing one before starting] |
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Hi
I can't understand 2 things:
1)What does the bank issue has to do with the trade engine bug....as I saw the site was put offline as soon (I hope the fastest possible) someone make the bug notice in the site chat but then the comes out the message informing us "The Polish authority closed our Bank account in Poland" "All funds are safe." etc. I mean no reference to the trade engine bug and if "all bitcoin" are safe....
To my best knowledge, the address for international deposits changed ~a day before the trading engine problem became obvious, so there isnt necessarily a direct connection. Both (bug becoming evident and administration starting investigation) might have be triggered by the large amount of transactions on the day of the boom, though. 2)why isn't given the possibility for those no have been effected by the trading engine bug (I figure and I hope there will be many! for example those not having made a trade let say from the day before) to bring the btc out of this shit....
Admin says he is working on that. |
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Trouble is when it comes to money laundering/money for terrorism suspicions, the authorities are paranoid and the standard procedure is to freeze all funds, so the innocent suffer as well as the guilty...
I only hope the outlook in reality is better than it looks right now.
Good point on the "money for terrorism". I personally find it ridiculous that its attached to "money laundering/ ..." in every official instance (big fish and 99.9999% are still just illegal non-terrorist business id guess), but thats the state we are at  , with all the resulting paranoia. The problem for TAiS46 is probably that if there are even a few suspicious transactions (as the example he has given, money from hacked bank accounts being wired to his account to buy BTC), the only thing he can tell authorities is that his site made it disappear anonymously (not having used verification). So its hard to convince them he actually didnt have anything to do with it, and innocent until found guilty is a bit problematic in application if he is (probably) found in violation of regulations. And yep, BTC wise, if he manages to sort out the multi-transactions (just some time/help) he should technically be able to send at least the majority of them back. |
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Just adding some information I collected in various threads and on reddit: Bitcoin24 is pretty much dead, mainly for the second of two problems: 1) The admin/owner TAiS46 does not seem to have the necessary experience to run a big trading platform. As evident from a few slightly worrying questions he asked in coding forums the last months, bitcoin24 was a bit of a learning-by-doing thing. As we all know due to a problem of the trading engine to deal with multiple requests of the same trade (that was already discussed on a php forum two months ago) too many BTCs were credited for a number of trades (the list can be found online), but to my best knowledge we dont know whether significant BTCs were removed by users exploiting that bug. I personally think this is the reason TAis46 took the site down and he is now supposedly working on rolling back the double/triple/quadruple orders that happened (to his expense) and fixing the trade engine. He still has 16k+ bitcoins in his cold storage (1GcWYgqbdtzZAGsX2iSVBS74cPBiQjCiRg, 1AnixjBYxpTzAmfSa8kRdBiUaSGV2e9d26) and an unknown number in user deposit addresses I guess. Whether he will pay that out or be able to is anyones guess, also see 2). 2) There are strict regulations in place for any bank/currency exchange/... operating in europe, to hinder money laundering: - the operator has to identify every customer, e.g. mtgox verification before entering a significant (withdraw/deposit amount) business relationship - any transactions above 15k euro, or even below if suspicious (e.g. anonymous savings account) has to be reported to the authorities Hence bitcoin24, from the start, violated anti-money laundry regulations, probably strongly. From a post on reddit: http://www.reddit.com/user/TAiS46 he still seems to think thats not his responsibility, but thats wrong and naive. He even admits having had trouble with his german account from the start, as known stolen (phishing/hacked) accounts transfered money to his account, but despite that didnt think it through but instead just used a polish account. bitcoin24 was very convenient for legitimate users, but for the same reasons the perfect money laundering tool. Considering his success, he managed to fly under the radar for quite some time, but that wont work infinitely (hindsight ). Its not clear that the current legal trouble is due to accusations of money laundering, but it seems very likely. Either someone in administration noticed the amount of money going through his site and reopenend investigation, or the investigation was started by following the money that disappeared from known stolen bank accounts again. The german administration requested assistance from the polish, and they were just faster in freezing the account. The german account is on very low transaction limit, not completely frozen yet, but is expected to soon be (all according to TAiS46, and I think he might actually say the truth) Due to being in violation of regulations from the start of bitcoin24, I dont see him having any chance in the legal battle, though (edit: problems 1 and 2 are probably not directly connected, as he changed the account for international deposits the day before the site went down, but might be both connected to the preceding price boom) The big question is I guess now whether the administration asks him to freeze bitcoin assets also, and if not, whether he'll actually be able to/allow withdrawal of BTC. The fiat is probably tied up in the legal battle for quite some time. Fines for money laundering (even if not that intentionally) can also be rather high (its not the US where a big bank had to pay a 1.9 billion dollar fine, but still). In any case bitcoin24 is dead, the admin in deep trouble, what he will do with the BTC is anyones guess now. TL;DR version: bitcoin24 ran a multi-million euro business -without anyone having the technical competence to run such a big platform -without any legal advice All else follows logically from these two. P.S.: Hindsight is of course cheap |
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Rereading trolly OP again. "They should pay more"  People will join mining until the gain is marginal compared to power cost. By definition its worth it, else nobody would be doing it. |
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Ok, sufficiently baited to do an actual response  In addition to fully agreeing to brinebold (e.g. stress on GPU), even the electricity cost is a relative thing. Personal example: I am living in a house which (typically french I guess) has electrical heating only. Most of the rooms are heated by one electrical radiator per room, the total electricity the heating eats up in the winter months is about 3kW total. I could replace the radiators in a few rooms by mining rigs at 0 electricity cost. Any W they use ends up as heating in the end, saving me the same W in electrical heating. So even if GPU mining drops to the point (very location -> electricity price dependent) where it technically doesnt look profitable power cost wise, 5-6 months of the year I could mine for no running costs at all. Whether one thinks its worthwhile to buy rigs or upgrade machines specifically for mining is a different question, which everyone knows best himself i guess . P.S.: I wrote a lot of "could", the above actually was my plan for last winter, as I have a few slightly outdated PCs standing around (that can still fit 5790s), but then was too busy with other stuff to actually set it up |
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Adding a bit of info collected mostly on reddit:
bitcoin24 currently has two problems:
- bank accounts being frozen due to investigation of potential money laundering
Apparently they had problems with the german account from the start, due to allowing large deposits and withdrawals and having no verification system in place. So people used phished access to other peoples accounts to deposit large sums and used bitcoins to launder.
At the very start of bitcoin there was supposedly an investigation but dropped.
Its back now and both the german account as well as the polish (which he has as "workaround" of the problems in germany at first) are getting frozen.
- trading engine bug that gave a number of users double, triple, ... the BTC they should get. Transactions will have to be rolled back and the bug fixed before any BTC can be withdrawn.
If he will actually be able to allow that once its fixed isnt clear due to problem 1
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It's digital currency, without the madness of the non value add of mining.
Sounds like a win in my book.
Where do ripples come from then? Oo |
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How pitifully small the shares you get actually are is completely beyond a joke, they want to abuse people GPUs with high stress levels and pay out not even pennies its an outright scam. My gpu would probably burn out long before I make £10. I know my rate wasn't good but even if my 46 mhash was 460 mhash my GPU would still burn out long before I made any actual money. I think we are all pretty much being taken for a ride, even if your rates are alot better you are still pointlessly stressing your gpu for small payouts. If they want us to stress our computers and use copious amounts of energy they should pay out ALOT more. The whole thing is a scam to make some rich guy richer and hes doing it by burning out YOUR computer not his.
LoL, especially reading your sig Trollbait? |
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Like others, I thought this was a bit of a nuisance at first but I can understand why it's in place and 5 posts is not too much to ask Depends, not sure whether its worth it requesting 5 potentially non-sensical posts (as topics discussed in newb section are limited) |
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Man....I have been on this site ALL day reading and just made an account...could have been done with my 5 hours already haha
Dito |
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