Scammer Tags- Pirate Pass Through operators ?

[muyuu]

I'm trying hard here to understand how a late entrant in a PPT is in any better position than a late entrant directly in Pirate's Ponzi, other than the fact that the PPT operator may suck up a bigger part of the butthurt when it finally collapses. This makes the operator a scammer? makes no sense whatsoever. If they were indeed having a better rate then he'd have a point.

Knowingly paying someone else to make you the recipient of fraudulent transfers makes you a scammer.

Only if you have any way to know these transfers are fraudulent. That's like labeling me a scammer because I got interest in my account in Barclays and they made money from fraudulent operations. I have absolutely nothing to do with that and cannot reasonably be held accountable.

In any case, by this argument all securitization should be banned, which I think it's ridiculous. The PPT themselves weren't opaque and were very public about their exact conditions. I believe this is perfectly legitimate.

Again, nobody is arguing they scammed their own depositors. You can stop beating to death the argument that nobody is making.

I mean that they were very public to everybody, both clients and not. Transparency is a factor here, it's not like PPT ops ran secret rackets where they positioned themselves better in the pyramid. This simply did not happen at any level AFAIK.

People who invest in non-audited securities directly or indirectly do so at their own risk and they should be able to shoot themselves in the foot. GLBSE will start offering some surface proof of operation for those who want some standarised book-keeping of ventures. And in any case you should be wary of anything you cannot very closely verify.

The problem is that they shoot other people in the foot, not just themselves. When someone invested in Pirate, they were paying Pirate to take someone else's money -- someone who was told their money would be legitimately invested -- and give it to them. Clearly, that is not an actual investment in any sense of the word.

It's a derivative and I've seen much worse IRL.

I will continue defending these practices as perfectly legitimate (talking about PT securities in general) and put the limit at the personal responsibility of people knowingly entering into opaque investments directly or indirectly. The scammer here is Pirate and knowing collaborators only, no matter how hard others may try to have a go at anyone who actually invested and lost money to Pirate (or got lucky and didn't). Other scammers would be those who knowingly participated and benefitted from the scam. To pretend someone who lost a massive amount and who's going to pursue Pirate IRL had inside knowledge seems absurd to me.

You are advocating a scammer tag policy based on insufficient grounds. I think this is a matter to approach on a case-by-case basis. A passing-through operator can be a scammer, or not.

[1714891662]

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[payb.tc]

4) suddenly proclaimed an 'all-or-nothing' stance towards pirate, despite having been willing to trust him previously, only after the default was announced

what part of reality does this statement stem from? in fact i would be very happy to accept less than 'all', as i'm sure would most people at this point.

[Micon]

As you can tell throughout some of my posts before the BCST bust, I was always trying to determine which category the various PPT operators fell into:

A) Stupid, young and/or naive, totally believing Pirate's bullshit:  I agree again with something Joel Katz said:  give them 1 time pass in this scenario.  I believe PPT operator Goat falls into this category. 

B) Suspects foul play, but continues to help scammer make large money while making small money:  Now we cross into "criminally negligent" --> there must be accountability for Payb.tc as I believe he falls in this category.  He was instrumental in helping Pirate steal ~$1.5M in BTC.  he did so continuously for months and months.  Hard to believe he didn't suspect scammery and continued to promote his product so he could make a small % each week while sending the bulk to Pirate, likely knowing he was helping the scam get much bigger.

C) Totally knows what's going on, fucks over everyone to make small money while knowingly shipping huge monies to a scammer:  Under this scenario the passthrough operator is a high level scumbag.  I believe BurtW falls into this category.  Constantly shilling for Pirate, putting in his signature "Pirate is not a Ponzi" making these horribly transparent shill-threads ( https://bitcointalk.org/index.php?topic=97094.0 ) --> Dox him at the stake.

[JoelKatz]

Only if you have any way to know they transfers are fraudulent.

Which is obviously the case here since fraudulent transfers were the only possible business model known. (Other than obviously ridiculous things such as someone who gives away money for no logical reason and happens to choose people who would invest in something that looks precisely like a Ponzi scheme as the beneficiaries of his generosity.)

[muyuu]

Only if you have any way to know these transfers are fraudulent.

Which is obviously the case here since fraudulent transfers were the only possible business model known. (Other than obviously ridiculous things such as someone who gives away money for no logical reason and happens to choose people who would invest in something that looks precisely like a Ponzi scheme as the beneficiaries of his generosity.)

I'm sorry but I don't buy into the argument that no operators could be deluded. I also don't think this forum should label the same way proven/obvious scammers and people running dubious operations, for some arguable concept of dubious. There could be a label named "has defaulted" or something of the sort, but ultimately you cannot defend people from being reckless and not doing their due diligence.

[danieldaniel]

Sorry, but everyone in the situation knew what was happening.  There was no murder, in which the murdered person didn't know he was going to be murdered.  This is therefore an invalid argument.
The investors knew that it may be a scam.

You kind of just contradicted yourself. First you say that everyone knew what was happening. Then you say the investors knew that it may be a scam. Did the investors know it was a scam?

Are you saying everyone who claimed it wasn't a Ponzi was lying and that everyone really did know that it was a Ponzi scheme all along? If so, the PPT operators who didn't say they knew it was a Ponzi were lying, just like Pirate. Right?

If someone comes up to you and says "I will steal your money if you give it to me, but I will fake very high interest rates to make it look as if you're making money." and you give him money, when he steals the money, did he really scam you?  Scamming is lying/not fulfilling a contract.  If, as you said, it was so blatantly obvious that it was a scam, then the PPT operators didn't scam anyone.  They merely offered a service that they knew no more about than we did.

If it's your position that everyone knew it was a Ponzi scheme all along, then the PPT operators were knowingly participating in a Ponzi scheme. They're as deserving of scammer tags as Pirate.

The reason I said that is because you said it was very obvious that it was a ponzi.  So, if what you say is true, nobody knew more than anybody else (except for pirate, obviously).  If the investors knowingly invested in something that was likely a scam, and they knew it was likely a scam, they knew nothing more than PPT's. 

Now, I'm not saying it was ethical to run a PPT, I'm just saying that it doesn't really justify a scammer tag.

[Puppet]

Now, I'm not saying it was ethical to run a PPT, I'm just saying that it doesn't really justify a scammer tag.

For only running a PPT, I would agree. For lying about having inside knowledge of Pirate's identity and business, thereby increasing confidence in Pirate and thus making more money on the PPT, a scammer tag is warranted.

[JoelKatz]

The reason I said that is because you said it was very obvious that it was a ponzi.  So, if what you say is true, nobody knew more than anybody else (except for pirate, obviously).

By this argument, Pirate wasn't doing anything wrong. Everyone knew he was running a Ponzi. Everyone knows Ponzis must eventually default. All that's unknown is the time of the default. And it's quite possible Pirate didn't even know that much before anyone else. Sure Pirate lied, but nobody believed him, so no harm done.

If the investors knowingly invested in something that was likely a scam, and they knew it was likely a scam, they knew nothing more than PPT's.

And Pirate knew nothing they didn't know. So it was all just honest fun. Pirate's scammer tag should be removed. Right?

Now, I'm not saying it was ethical to run a PPT, I'm just saying that it doesn't really justify a scammer tag.

Then start arguing that Pirate doesn't deserve a scammer tag. In all likelihood, his primary business model was operating a pass through to Zeek. (And market manipulations which largely lost money but he said he was going to do that.)

[smoothie]

I say give them all (PPTs) scammer tags.

They profited off of this bullshit.

[Frankie]

As you can tell throughout some of my posts before the BCST bust, I was always trying to determine which category the various PPT operators fell into:

A) Stupid, young and/or naive, totally believing Pirate's bullshit:  I agree again with something Joel Katz said:  give them 1 time pass in this scenario.  I believe PPT operator Goat falls into this category. 

B) Suspects foul play, but continues to help scammer make large money while making small money:  Now we cross into "criminally negligent" --> there must be accountability for Payb.tc as I believe he falls in this category.  He was instrumental in helping Pirate steal ~$1.5M in BTC.  he did so continuously for months and months.  Hard to believe he didn't suspect scammery and continued to promote his product so he could make a small % each week while sending the bulk to Pirate, likely knowing he was helping the scam get much bigger.

C) Totally knows what's going on, fucks over everyone to make small money while knowingly shipping huge monies to a scammer:  Under this scenario the passthrough operator is a high level scumbag.  I believe BurtW falls into this category.  Constantly shilling for Pirate, putting in his signature "Pirate is not a Ponzi" making these horribly transparent shill-threads ( https://bitcointalk.org/index.php?topic=97094.0 ) --> Dox him at the stake.

Y'know, I do agree with you about BurtW shilliness, but I'm not sure that we can be certain enough about the actor's subjective intent.

Take Goat (please!). He sure acts a lot more humbled, confused, and pissed off at Pirate that BurtW (who is still shilling up a storm), but consider that it's relatively easy for a knowledgeable person to feign ignorance and for a smart person to play dumb. It is truly breathtaking how dumb Goat's posts are--I mean, if you take him at his word, he still think that Pirate had a super-sekrit money-making system. If you take him at his word, he thinks there's powerful evidence Pirate was never running a Ponzi. It's so dumb, I find it borderline incredible.

I agree there's a good chance that Goat got duped, but I wouldn't bet even money on it.

To my mind, the best way to separate the sheep from the goats is to determine whether they misled other people in aid of the scam. By that measure, I think Goat is a goat; viewed in the most favorable light, he had no idea what Pirate was doing, but whenever someone would point out obvious truths about the scam, he would shout them down, assert that he had a pretty good idea what Pirate was doing, and so forth.

Goat was no passive conduit of funds to Pirate, no mere public service requested by Theymos. No, Goat was an active promoter.  For that reason, I would group him in with BurtW. Even if he was suckered by Pirate (which impossible to determine given what we know), he was a useful tool in misleading others about Pirate's scheme.

[LoupGaroux]

I say give them all (PPTs) scammer tags.

They profited off of this bullshit.

Agreed. 100%. There are no shades of gray in this brutal gang rape, every one of the PPT operators who have not made good on the funds invested through them, is just as guilty as pirate, and deserves just as nasty of a consequence.

The only way out should be to compensate everyone for everything they sent through, in full, and then permanently shutting the fuck up about it.

And reset all of their experience and post counts to zero, because their is nothing heroic, supportive, or VIP about fucking people for profit.

[BinaryMage]

I say give them all (PPTs) scammer tags.

They profited off of this bullshit.

Agreed. 100%. There are no shades of gray in this brutal gang rape, every one of the PPT operators who have not made good on the funds invested through them, is just as guilty as pirate, and deserves just as nasty of a consequence.

The only way out should be to compensate everyone for everything they sent through, in full, and then permanently shutting the fuck up about it.

And reset all of their experience and post counts to zero, because their is nothing heroic, supportive, or VIP about fucking people for profit.

Are you stating that the PPT operators are guilty regardless of knowledge, or that you believe they all had knowledge of the nature of BS&T? In either case, I'm intrigued to hear your rationale.

Judging anything consequential on post count is illogical and, frankly, idiotic. VIP/donator status is given solely based on a donation to the forum. If Theymos starts modifying user attributes / stats on subjective guidelines, half the forum will leave, and rightly so. The only reason this forum is still so active is because of the remarkable lack of subjective moderation.

[JoelKatz]

Are you stating that the PPT operators are guilty regardless of knowledge

Yes. The standard is whether they knew or should have known. A millisecond's due diligence would have made it clear that no plausible business model was known other than a Ponzi scheme or similar scam. There simply wasn't any other reasonable possibility. But they looked the other way because there was money to be made at no risk to themselves.

[BinaryMage]

Are you stating that the PPT operators are guilty regardless of knowledge

Yes. The standard is whether they knew or should have known. A millisecond's due diligence would have made it clear that no plausible business model was known other than a Ponzi scheme or similar scam. There simply wasn't any other reasonable possibility. But they looked the other way because there was money to be made at no risk to themselves.

I cannot agree. The proof in question here is not whether a plausible business model existed that could have been the basis for Pirate's operation, but whether the PPT operator in question thought there was a plausible business model. Knowledgeable negligence with investor funds and lack of some subjective level of diligence are not the same thing. I understand it seems obvious now, but hindsight bias is a real issue here. Before Pirate closed up shop, there were really only a few select individuals calling it a Ponzi. Now, I see a new poster every few minutes claiming to "have known it all along." Many possible business models exist that could make the kind of returns Pirate provided - plausibility is the question. You cannot prosecute someone for disagreeing with you on what is or isn't plausible.

[iCEBREAKER]

2) refused to comply in good faith with pirate's request for PPT account information

3) refused to comply with his own BitcoinMax account holders' requests that their account info be passed through to pirate

He had to do these two things, for reasons that I explained elsewhere. He had no other way to protect those of his investors who did not wish their information given to Pirate.

I don't care about his other investors, especially those who decide to not accept the terms of the default.  They forfeited their right to a share of any settlement by refusing.

PPT customers agreed to pirate's terms for PPT funds by signing up.  At the point where they stop abiding by pirate's terms, they have broken the agreement.

As an aside, it's ludicrous to trust pirate (and an anonymous PPT operator) with your bitcoins but not trust pirate with your account info.

Had he passed through information to Pirate, there is no way he could have prevented Pirate from trying to settle his debts directly, depriving other of his investors of their rightful share of those payouts. If you and I each half own a house, you can't cut the house in half, sell half of it, and keep all the profits as "your half". We are each entitled to half of the proceeds of the sale of any part of the house. You are not fully entitled to all the proceeds of the sale of half of it leaving me to try to sell my half by myself.

The recalcitrant other investors have no "rightful share of those payouts" for the reasons I stated above.  In contrast, I (by intending to comply) do have a rightful share.  And paybtc had no right to deprive me of the opportunity to negotiate or whatever directly with pirate.  That's why he deserves a scammer tag.

You are using the wrong (outdated) frame to conceptualize the PPT fund.  Before the default, your metaphor was apt.  After the default (IE during the wind-down) the PPT fund is no longer like a house. 

That is the same problem paybtc encountered (and unfortunately passed through to his customers).  Previously indivisible assets become liquid in a bankruptcy, for purposes of distribution to creditors.  We asked him to leave the Before Time (the Long-Long Ago) and join us in the post-default present, but he refused to accept this scary new reality.

In terms of the house metaphor, think of it as a foreclosed property being sold at auction (liquidated) and the proceeds being divided among those following the rules set by the executor.  The executor is pirate in this case, which is a conflict of interest, but who else could do it?   

[payb.tc]

And paybtc had no right to deprive me of the opportunity to negotiate or whatever directly with pirate.  That's why he deserves a scammer tag.

i have the right to get paid for my time.

those of you demanding i do something have never actually offered any kind of compensation, they just make demands of me like i'm some kind of charity.

go negotiate with pirate if you want to.

if you want me to do it on your behalf, make me an offer or STFU.

[JoelKatz]

I don't care about his other investors, especially those who decide to not accept the terms of the default.  They forfeited their right to a share of any settlement by refusing.

You may not care about his other investors, but he has to. And you can't just add new terms to an agreement and declare other parties to have forfeited their rights by refusing your new terms. That would be scamming, and that's precisely what didn't happen.

PPT customers agreed to pirate's terms for PPT funds by signing up.  At the point where they stop abiding by pirate's terms, they have broken the agreement.

PPT customers had no agreement with Pirate and they certainly had no agreement that required them to do whatever Pirate asked them to do at any time.

As an aside, it's ludicrous to trust pirate (and an anonymous PPT operator) with your bitcoins but not trust pirate with your account info.

I completely and totally don't agree, and I suspect a lot of other people don't either. In any event, other people will have different priorities from you.

Had he passed through information to Pirate, there is no way he could have prevented Pirate from trying to settle his debts directly, depriving other of his investors of their rightful share of those payouts. If you and I each half own a house, you can't cut the house in half, sell half of it, and keep all the profits as "your half". We are each entitled to half of the proceeds of the sale of any part of the house. You are not fully entitled to all the proceeds of the sale of half of it leaving me to try to sell my half by myself.

The recalcitrant other investors have no "rightful share of those payouts" for the reasons I stated above.  In contrast, I (by intending to comply) do have a rightful share.  And paybtc had no right to deprive me of the opportunity to negotiate or whatever directly with pirate.  That's why he deserves a scammer tag.

He absolutely not only had the right to deprive you of that but the obligation to do so. You, on the other hand, have no right to negotiate with Pirate and deprive his other investors of their rightful share of any payout you might receive.

Fortunately, it didn't make any difference. Not surprisingly, there weren't any payouts regardless. So all he did was prevent Pirate from getting identities where we have no idea what he would have done with them.

[the joint]

For PPT operators to be deserving of a scammer tag, my opinion is that:

It must be demonstrably proven that 1) a PPT operator knew Pirate's operation was a scam and 2) said PPT operator did not disclose his knowledge of Pirate's scam to any/all investors and/or 3) said PPT operator did not give explicit and sufficient warning to all investors that there was a reasonable and real risk of some or total loss of deposits.


As far as I know, it's hard to scam someone when you don't know you're scamming someone.  I think scamming is largely about intent.  

Imagine that you've never seen a change machine before, and that I explain to you that you will receive four quarters by inserting a dollar into the machine.  So, you insert a dollar into the machine and - KaBLAMO! - you hear a knocking inside the machine and it shuts down.  Not only won't you get your four quarters, but depending on your personality you might be pissed at me for suggesting that the machine would work in the first place.  But ya know what?  I had a reason to believe that there was a damn good chance that the machine would work for you as it has worked for me.

Now imagine that you've never seen a wishing well before, and I tell you that if you throw a dollar bill in the well you'll get four quarters in return (you need toll money badly).  So, you toss a dollar in and - .......... -  nothing happens.  You're pissed because you lost a buck.  You ask a stranger nearby if he's ever received four quarters for a buck at the wishing well, but when he tells you what a wishing well actually is, you begin chasing me angrily with clenched fists.  But ya know what?  You can't catch me because I'm driving a Porsche while screaming "I own part of the well!" out the window.

[JoelKatz]

It must be demonstrably proven that 1) a PPT operator knew Pirate's operation was a scam and 2) said PPT operator did not disclose his knowledge of Pirate's scam to any/all investors and/or 3) said PPT operator did not give explicit and sufficient warning to all investors that there was a reasonable and real risk of some or total loss of deposits.

It sounds like, given the presence of number 2 above, you're responding to the argument that PPT operators scammed their investors. I don't think anyone's making that argument.

The argument is that PPT operators scammed other Pirate investors by paying Pirate to make their customers the recipients of transfers they should have known were fraudulent -- transfers where Pirate obtained the money by representing that the funds would in fact be invested and where they knew that transfers to PPT operators were certainly not a legitimate investment of any kind. PPT operators paid Pirate to operate a Ponzi scheme for the benefit of their customers, and they either knew or should have known that this was what they were doing.

Everyone knew Pirate's operation was almost certainly a scam. (And perfect certainty is never the standard.) No other possible business model was known and every previous such get rich quick scheme has proven to be a scam. Every single sign of a Ponzi scheme was present and there was never the slightest shred of any actual legitimate business activity. At least a dozen people were explaining on the forums why it had to be a scam. You can't stick your fingers in your ears and scream "LALALALALA!" while a dozen people are trying to tell you something and later claim you didn't know that.

Let's see if we really believe your argument though. Say another Pirate comes along with precisely the same pitch, the same vague business model, the same absence of any evidence of any actual investment activity. And say someone starts up a pass through to this new scheme, claiming they don't know it's a scam and they think it's legitimate for some reason. Because ... Bitcoin! Would you say they're doing anything wrong?

[BinaryMage]

It must be demonstrably proven that 1) a PPT operator knew Pirate's operation was a scam and 2) said PPT operator did not disclose his knowledge of Pirate's scam to any/all investors and/or 3) said PPT operator did not give explicit and sufficient warning to all investors that there was a reasonable and real risk of some or total loss of deposits.

It sounds like, given the presence of number 2 above, you're responding to the argument that PPT operators scammed their investors. I don't think anyone's making that argument.

The argument is that PPT operators scammed other Pirate investors by paying Pirate to make their customers the recipients of transfers they should have known were fraudulent -- transfers where Pirate obtained the money by representing that the funds would in fact be invested and where they knew that transfers to PPT operators were certainly not a legitimate investment of any kind. PPT operators paid Pirate to operate a Ponzi scheme for the benefit of their customers, and they either knew or should have known that this was what they were doing.

Everyone knew Pirate's operation was almost certainly a scam. (And perfect certainty is never the standard.) No other possible business model was known and every previous such get rich quick scheme has proven to be a scam. Every single sign of a Ponzi scheme was present and there was never the slightest shred of any actual legitimate business activity. At least a dozen people were explaining on the forums why it had to be a scam. You can't stick your fingers in your ears and scream "LALALALALA!" while a dozen people are trying to tell you something and later claim you didn't know that.

Let's see if we really believe your argument though. Say another Pirate comes along with precisely the same pitch, the same vague business model, the same absence of any evidence of any actual investment activity. And say someone starts up a pass through to this new scheme, claiming they don't know it's a scam and they think it's legitimate for some reason. Because ... Bitcoin! Would you say they're doing anything wrong?

No, I would not. Would I invest? Certainly not. But I try not to condemn people based on subjective judgement.

If I had evidence that they did know the true nature, I would absolutely consider them a scammer. A fair legal system works on facts - not opinions. With all due respect, assuming you know the 'true nature' of anything and condemning people based on that opinion is nonsense. If you have facts, that's a different matter, but, at least in my humble and perhaps inexperienced opinion, innocent until proven guilty.