there has been a lot of speculation as to what pirateat40 is doing in order to be able to offer seemingly impossibly good returns in BST and such high rates at GPUMAX.  While it has already been speculated upon I would like to confirm: PirateAt40 is laundering money.  

Here is how they work:

Bitcoin Savings & Trust

Many have asked: How is Pirate regularly paying off 7% a week, with consistency and over a period of time?  (a ponzi would have folding months ago)

Pirate tries to maintain a buffer of somewhere between 10-50k clean bitcoins on hand.  These are the investments from the BTC community.   When one of his customers needs their Bitcoins laundered, he sends them 30-50% the number of dirty Bitcoins back to the customer in clean bitcoins.  (Some of his customers get better rates than others).  then he uses the dirty bitcoins to pay interest back to the depositors.  

This buys his customers the assurance that their new coins are no longer connected to them through the blockchain.  But he can offer them one better...

GPUMAX

GPUMAX is the ultimate form of money laundering because your coins don't come from anyone. they are printed out of thin air.  Miners are happy to be paid 150% without asking questions.  anyone who has been paid out from GPUMAX has recieved dirty coins (unless you were a really early tester).  He can send fresh clean coins to anyone who pays him in bitcoin.  we know that even people who don't have a relationship with us are using it to launder.

Why am I posting this?

Sorry, but I can't say too much without putting myself in the line of fire.  Pirate is a nice guy at heart, but he does business with some ugly people who I don't want coming back to me. recently though, he hasn't been thinking about the long-term for bitcoin, only the short term profits for himself.  he is reinvesting his money in businesses which are illegal in his (and most other) jurisdictions around the world. but the part i am most worried about:

Over the past few months, Pirate has started to get stupid about his IRL spending habits.  He has made some purchases that are probably going to raise some red flags.  His "legitimate" occupation will not stand up to scrutiny if the feds shine a light on him.  there is no way he can justify the amount of money he is pulling out. hes not keeping a clean head and people that know him can tell something isnt quite right. this is what really has me concerned, because he is just being too flashy.

edit: lender beware