Nefario

[Bitcoin Oz]

This was a strange version of a stock exchange anyway. I'd like to see more of a Kickstarter style method to aggregate Bitcoin value. Is there any such project? I think Kickstarter has successfully avoided SEC scrutiny by not exchanging "ownership" or "selling shares."

If you strip out the ability to buy and sell the shares and simply pay dividends it would be better.

Kickstarter doesnt pay dividends though.

[Deprived]

Pirate asks for AML info before he'll give the money up. Never gives the money up.
Nefario asks for AML info before he'll give the money up. (predictable result goes here)

Why are you stating that Nefario asks for AML info? All I've seen is the GLBSE statement posted today on their Web site saying that if you are willing them to share your email, user name, and a btc address with the issuers, you can continue your relationship with the issuers (presumably based on claim codes GLBSE will provide).  That's all the information available as of today. No need to spread FUD.

Users will be able to collect deposits only after submitting identity info.

Identity meaning what exactly?  Will my login credentials and deposit address suffice?

MtGox-style AML documents.

This contradicts what Nefario put on the home page:

Q:I'm a GLBSE user, what about my assets and my bitcoin?

You will be able to get back your bitcoin, and if you want to reveal your username, email, and a bitcoin address to accept payments with, you can continue your relationship with the issuer of any assets you hold.

If you read it carefully, it actually does not contradict.  All that is said above about bitcoins on glbse.com is that we will be able to get them back.  Nothing else.

What puzzles me slightly is the basis on which nefario could request personal information.

In general, UK companies are NOT required by law to obtain information identifying their customers.  We can walk into a shop and buy something without ever telling our name - let alone proving our identity.  And the same is true for many other services.

The largest exception to this is Regulated Financial Service Providers - they DO have a requirement to obtain proof of identity (and also various KYC/AML obligations - though most of those are not statutory in nature).  But GLBSE is NOT regulated.  IF nefario's argument is that GLBSE SHOULD have been regulated then asking for proof of ID now is:

a) Shutting the stable door after the horse has bolted.
b) An admission of guilt.

On the first point, the whole issue is that we AREN'T gonna be his customers.  As he isn't regulated so has no regulatory obligations he would be constrained by the Data Protection Act's requirement not to keep personal data for longer than was needed.

On the second point, not having requested our identities is pretty trivial compared to his other offences IF he is claiming he has been running a Financial service that should have been regulated but wasn't.  It's like robbing a bank and handing out ear-mufflers to everyone in there as you're worried you might otherwise be breaking Health and Safety regulations if you discharge a firearm.

As far as KYC/AML obligations are concerned the primary purpose of these (in the context of AML) is to identify suspicious transactions.  What suspicious transactions could he conceivably expect to uncover when the only ones which will now be carried out are him refunding our outstanding balances?

Here's the summary of what the data protection act says:

"Data protection – looking after the information you hold

If you hold and process information about your clients, employees or suppliers, you are legally obliged to protect that information. Under the Data Protection Act, you must:

    only collect information that you need for a specific purpose;
    keep it secure;
    ensure it is relevant and up to date;
    only hold as much as you need, and only for as long as you need it; and
    allow the subject of the information to see it on request."

So what specific purpose does he need this information for?  If he's claiming a regulatory need than how (and by whom) is he claiming GLBSE is regulated?

How long is he claiming he'd need if for?  

What need does he have for it after our BTC have been returned?  If none, then on what basis does he plan to continue holding that information?  If he doesn't plan to keep holding that information then where is the need?  Or is he planning to issue everyone with personal cheques (where he WOULD need identity information)?

What is he planning to do that causes that need now, when no such need existed for prior withdrawals?

"I'd like it to have something to hand over if I'm investigated" isn't a need - nor is it a valid reason to hold personal information under the DPA, as it isn't necessary to conduct the business we have outstanding (withdrawal of BTC).

[k3t3r]

Guys, make some public noise here if you wanna see Theymos make the motion.

I would be happy to see the funds returned to Nefario. Theymos is a anonymous entity to me. There is no evidence that nefario is doing anything malicious with the funds he holds. Nefario has had plenty of opportunity to cut and run with the funds and he has not. He returned funds to goat which he could have misappropriated. Even Theymos has know confirmed that Nefario is simply tying to follow the spirit of the laws surrounding GLBSE. This is not a bad thing, following the spirit of the law shows honesty not dishonesty.

I also agree with the suggestion above that nefario can begin repayment with the funds he has and Theymos could return the funds he holds when this has happened. This could be tracked on the forum by people willing to disclose this.


Edit:I missed this too.

Guys, make some public noise here if you wanna see Theymos make the motion.

No people are missing an important part.


Neither Theymos OR Nefario are going to control any coins. They will send them to ColdHardMetal who will disperse the coins.

The shareholders passed a motion for CHM to do this and Theymos is refusing. Waiting for Nefario to send CHM the company funds to get the party started.

[Bitcoin Oz]

Guys, make some public noise here if you wanna see Theymos make the motion.

I would be happy to see the funds returned to Nefario. Theymos is a anonymous entity to me. There is no evidence that nefario is doing anything malicious with the funds he holds. Nefario has had plenty of opportunity to cut and run with the funds and he has not. He returned funds to goat which he could have misappropriated. Even Theymos has know confirmed that Nefario is simply tying to follow the spirit of the laws surrounding GLBSE. This is not a bad thing, following the spirit of the law shows honesty not dishonesty.

I also agree with the suggestion above that nefario can begin repayment with the funds he has and Theymos could return the funds he holds when this has happened. This could be tracked on the forum by people willing to disclose this.


Edit:I missed this too.

Guys, make some public noise here if you wanna see Theymos make the motion.

No people are missing an important part.


Neither Theymos OR Nefario are going to control any coins. They will send them to ColdHardMetal who will disperse the coins.

The shareholders passed a motion for CHM to do this and Theymos is refusing. Waiting for Nefario to send CHM the company funds to get the party started.

Nefario wont be handling repayment. the company secretary will be. Theymos needs to send all; funds to CHM or hes breaking the bylaws and a voted on and passed motion.

[k3t3r]

Nefario wont be handling repayment. the company secretary will be. Theymos needs to send all; funds to CHM or hes breaking the bylaws and a voted on and passed motion.

I missed that previously, thanks.

[Severian]

I’m beginning to think Bitcoin is controlled by nothing but a bunch if inexperienced children straight out of college.

Beginning? What made you think any differently in the first place?

[Deprived]

Nefario wont be handling repayment. the company secretary will be. Theymos needs to send all; funds to CHM or hes breaking the bylaws and a voted on and passed motion.

I believe Theymos said that shutting down GLBSE was against the bylaws.  If so, then it would be ridiculous to claim he was breaking the bylaws by not sending the funds - when he knew that if he sent them they were going to be USED as part of breaking the bylaws.

It would be totally hypocritical for nefario to break the bylaws himself then whine about someone else doing it.

[Bitcoin Oz]

Nefario wont be handling repayment. the company secretary will be. Theymos needs to send all; funds to CHM or hes breaking the bylaws and a voted on and passed motion.

I believe Theymos said that shutting down GLBSE was against the bylaws.  If so, then it would be ridiculous to claim he was breaking the bylaws by not sending the funds - when he knew that if he sent them they were going to be USED as part of breaking the bylaws.

It would be totally hypocritical for nefario to break the bylaws himself then whine about someone else doing it.

Actually he was asked to send the coins to CHM before the meeting, when he said he was going to sell his shares.

He refused because he wanted to hand them over to the new guy who bought his shares or whoever took over his position.

[k3t3r]

Nefario wont be handling repayment. the company secretary will be. Theymos needs to send all; funds to CHM or hes breaking the bylaws and a voted on and passed motion.

I believe Theymos said that shutting down GLBSE was against the bylaws.  If so, then it would be ridiculous to claim he was breaking the bylaws by not sending the funds - when he knew that if he sent them they were going to be USED as part of breaking the bylaws.

It would be totally hypocritical for nefario to break the bylaws himself then whine about someone else doing it.

The issue seems to be that keeping GLBSE operating is breaking the "real world" law. What choice is there if GLBSE cannot continue to operate.

[Fcx35x10]

all the drama? 

[Puppet]

The issue seems to be that keeping GLBSE operating is breaking the "real world" law. What choice is there if GLBSE cannot continue to operate.

Exactly. Theymos is an anonymous shareholder in an illegal venture. Nefario is fully doxed, the one running the thing and potentially ending up in jail for it. For Theymos to say Nefario should just keep running it to earn cons for him,  while not wanting to expose himself to the legal repercussions  is.. not very fair to put it mildly. Bylaws can never supersede laws and any contract to the contrary is by definition null and void. The whole shareholder contract most likely has no legal value either.

[repentance]

I believe Theymos said that shutting down GLBSE was against the bylaws.  If so, then it would be ridiculous to claim he was breaking the bylaws by not sending the funds - when he knew that if he sent them they were going to be USED as part of breaking the bylaws.

It would be totally hypocritical for nefario to break the bylaws himself then whine about someone else doing it.

I don't think you can draft legally valid by-laws which prohibit an entity being shut down by its operators without creating perpetual trusts (and many jurisdictions don't allow the creation of perpetual trusts).  The foundation documents usually state what is to happen to any assets of an entity in the event it is ceases operating (in for profit enterprises, any excess is usually distributed to the shareholders after all required payments have been made - in non-profits, any excess is usually donated to another non-profit with similar objectives).  By-laws are only valid to the extent that they don't conflict with the actual law, though.

[Bitcoin Oz]

I want for Theymos to step up, and agree to manage the dispersal of customer funds.  He has shown himself to be far more forthright than mr. Nef, and is treasurer after all.  Giving over the treasury funds to Nef now after all that has happened is highly unlikely to result in a happy ending for us users IMO.

Theymos, I understand that your position sucks, and you just want out of it, like you did even before this whole situation exploded.  Unfortunately, you're our only hope, and the funds that you hold are valuable leverage.

Please do not give our monies over to Nefario!  Instead, demand a copy of the user database, and manage the dispersals yourself, as a proper Treasurer should.

The shareholders voted that I should send the funds to BitcoinGlobal's accountant. The only reason I haven't yet is that the accountant hasn't sent me an address. Even if I wanted to defy the shareholders, Nefario refuses to give me the database. It's unlikely that I could get the database in any reasonable amount of time.

If there's a lot of public noise about this very soon, maybe I could get a motion passed to keep the ~800 BTC in user funds with me.

He HAS sent you an address. You were sent it not long after announcing you were selling your shares. (1st october) but refused to do so.

[SebastianJu]

@Theymos Do you know someone able to access the database of glbse so that you can make a backup just in case? I dont want to hear at one time that all data is lost or something. Or that i have to join a new platform to get my shares and joining the new platform wouldnt be good for me.
Can you reveal the usernames of the glbse-shareholders? Are they reputated forummembers? Maybe they should say some words too when they know more.

As part of the "Nefario gets hit by a bus" plan, 4 of 5 shareholders selected by Nefario could maybe get Nefario's passwords and wallet if Nefario is incompetent enough to have not prevented this attack already. I already tried this route, though, and only 2-3 applicable shareholders are willing to do it.

I don't know how else you'd get the database.

I don't want to publish the shareholder list. Many people who opposed Nefario would like to remain anonymous, and even the people who supported him are decent enough people who I don't want to "out". Some of the shareholders did comment in this thread without saying that they're shareholders.

Regarding the 800BTC you hold. When he really still would hold 8000BTC why should he need the 800BTC? Didnt he want them for lawyer cost? And doesnt this imply that he doesnt even has 800BTC to pay the lawyer?
Or you think he only want them to put them into his new project?

Others say you should send it to ColdHardMetal and not to nefario. Whats correct?

So you mean 4-5 shareholders have the password and 2-3 would make a backup? That would be cool if it happens because then it doesnt all depend on nefario. In case he runs crazy we would have still the list of assets owned by what person. Even better 2 shareholders independently downloaded the datebase so that not one shareholder could manipulate it and we could compare.
So if possible i would try this. Just in case.

On the other hand nefario probably had changed password already in his "all turns around me" behaviour lately.

He HAS sent you an address. You were sent it not long after announcing you were selling your shares. (1st october) but refused to do so.

And is that correct then theymos? Or dont you think its the correct address? I mean its not hard to guess who are the shareholder in the thread and i dont see your actions here as if you want to scam. But hearing that usermoney isnt sent while you could do probably could be a bit worrying for persons that hold money at glbse.

[capn noe]

Nothing is stopping Nefario from interacting or communicating with stakeholders here. He may be required legally to refuse to comment on some things, but he could be in here reassuring people and at least ending the near-panic that the silence is causing.  His refusal to do this is baffling. 

[SebastianJu]

Nothing is stopping Nefario from interacting or communicating with stakeholders here. He may be required legally to refuse to comment on some things, but he could be in here reassuring people and at least ending the near-panic that the silence is causing.  His refusal to do this is baffling. 

I hope the reason behind he doesnt do this is that he works all the time at the script to give out the codes for shareholders.

[Bitcoin Oz]

Nothing is stopping Nefario from interacting or communicating with stakeholders here. He may be required legally to refuse to comment on some things, but he could be in here reassuring people and at least ending the near-panic that the silence is causing.  His refusal to do this is baffling. 

Nefarios lawyer is running glbse.

[Nite69]

Correct  

Edit: Looks like I'm right:

For US persons and companies, raising money on GLBSE is a felony under the Securities Act of 1934. To create a publicly traded investment, you have to register with the Securities and Exchange Commission first, and file forms like SEC Form 1-A.

This form starts with:

ITEM 1.
Significant Parties
List the full names and business and residential addresses, as applicable, for the following persons:
(a) the issuer’s directors;
(b) the issuer’s officers;
(c) the issuer’s general partners;
(d) record owners of 5 percent or more of any class of the issuer’s equity securities;
(e) beneficial owners of 5 percent or more of any class of the issuer’s equity securities;
(f) promoters of the issuer;
(g) affiliates of the issuer;
(h) counsel to the issuer with respect to the proposed offering;
(i) each underwriter with respect to the proposed offering;
(j) the underwriter’s directors;
(k) the underwriter’s officers;
(l) the underwriter’s general partners; and
(m) counsel to the underwriter.

You don't get to issue securities anonymously in the US. The usual penalty is 5 years in prison.

Here's a typical FBI report of a conviction for selling unregistered securities.. One of those people gets out of the Federal pen in 2015.

Operating entirely on line won't help. An online unregistered securities operator who ran AdSurfDaily is was arrested and is facing felony criminal charges. If you're wondering what the legal definition of a "security" is, see this court decision against the operator of AdSurfDaily. The terms for AdSurfDaily sound a lot like the ones for many GBLSE investments. Here's what AdSurfDaily advertised:

  Rebate Distribution: Ad purchase sales and banner ad sales on the Cash Generator and the sale of ebooks will be totaled at midnight each night and 50% of the gross sales will be rebated to add purchasers. Fifty percent of the commissions that the Cash Generator earns from their sister site, “Attract Marketing System,” will also be paid as rebates to ad purchasers on the Cash Generator.

Every night at midnight the number of eligible ad packages will be totaled and divided into the total ad package sales, banner ad sales and ebook sales to determine the amount of the rebate for each ad package. That amount will be multiplied by the number of ad packages in each advertiser’s account and the total will be credited to his/her cash balance account. Rebates will show up in your account after midnight EST.

Sounds like a lot of GBLSE offerings, doesn't it? That was held to be an "investment contract" requiring SEC registration in UNITED STATES OF AMERICA v.THOMAS ANDERSON BOWDOIN, JR., Defendant, Criminal Action No. 10-320 (RMC), United States District Court, District of Columbia, March 18, 2011. Mr. Bowdoin is looking at 125 years in prison, max.

There are a lot of countries outside US, which allows free trade. Everyone can move bitcoins over the country lines easily. Will not be long until a new stock exchange is up.

Edit: well, there already is..

[Bitcoin Oz]

You should probably all be aware that Nefario is already planning on creating a legal, regulated Bitcoin stock exchange service (of some sort) once this blows over.

I don't mean to be a hater, but I think that's going to be a pretty hard road to go down. Stock exchanges are complicated financial services, perhaps best left to professionals, no?

Another interesting thing from the conference though was talk about the Bitcoin Scripting which could allow for exchanges to operate without any 3rd party. Companies could run the process themselves, or someone could develop software allowing people to run an exchange themselves. 

Thats what I was thinking, kinda like trading ecrypted certificates. Make a place where you can post the sale of these certificates and then leave paying dividends to the issuer. Make some kind of rating system, where people who have bought sold like silk road can rate the sellers and the product.

Just gather some private investment and dont allow public trading of the shares. Thats how the company that runs glbse itself functions.

[Bitinvestor]

Correct  

Edit: Looks like I'm right:

For US persons and companies, raising money on GLBSE is a felony under the Securities Act of 1934. To create a publicly traded investment, you have to register with the Securities and Exchange Commission first, and file forms like SEC Form 1-A.

This form starts with:

ITEM 1.
Significant Parties
List the full names and business and residential addresses, as applicable, for the following persons:
(a) the issuer’s directors;
(b) the issuer’s officers;
(c) the issuer’s general partners;
(d) record owners of 5 percent or more of any class of the issuer’s equity securities;
(e) beneficial owners of 5 percent or more of any class of the issuer’s equity securities;
(f) promoters of the issuer;
(g) affiliates of the issuer;
(h) counsel to the issuer with respect to the proposed offering;
(i) each underwriter with respect to the proposed offering;
(j) the underwriter’s directors;
(k) the underwriter’s officers;
(l) the underwriter’s general partners; and
(m) counsel to the underwriter.

You don't get to issue securities anonymously in the US. The usual penalty is 5 years in prison.

Here's a typical FBI report of a conviction for selling unregistered securities.. One of those people gets out of the Federal pen in 2015.

Operating entirely on line won't help. An online unregistered securities operator who ran AdSurfDaily is was arrested and is facing felony criminal charges. If you're wondering what the legal definition of a "security" is, see this court decision against the operator of AdSurfDaily. The terms for AdSurfDaily sound a lot like the ones for many GBLSE investments. Here's what AdSurfDaily advertised:

  Rebate Distribution: Ad purchase sales and banner ad sales on the Cash Generator and the sale of ebooks will be totaled at midnight each night and 50% of the gross sales will be rebated to add purchasers. Fifty percent of the commissions that the Cash Generator earns from their sister site, “Attract Marketing System,” will also be paid as rebates to ad purchasers on the Cash Generator.

Every night at midnight the number of eligible ad packages will be totaled and divided into the total ad package sales, banner ad sales and ebook sales to determine the amount of the rebate for each ad package. That amount will be multiplied by the number of ad packages in each advertiser’s account and the total will be credited to his/her cash balance account. Rebates will show up in your account after midnight EST.

Sounds like a lot of GBLSE offerings, doesn't it? That was held to be an "investment contract" requiring SEC registration in UNITED STATES OF AMERICA v.THOMAS ANDERSON BOWDOIN, JR., Defendant, Criminal Action No. 10-320 (RMC), United States District Court, District of Columbia, March 18, 2011. Mr. Bowdoin is looking at 125 years in prison, max.

There are a lot of countries outside US, which allows free trade. Everyone can move bitcoins over the country lines easily. Will not be long until a new stock exchange is up.

Edit: well, there already is..

Many asset issuers are based in the US and they need to abide by their own laws or face the consequences.