Onus & Remedy in Scam Accusation Threads

[Deprived]

To be clear - are you saying someone who wasn't an investor can't point out scamming?

It's an interesting perspective to take that if a victim doesn't realise they've been victimised noone else should point it out.

Makes it somewhat of a miracle that anyone ever gets convicted of murder - as I've yet to hear about a murder victim come forward and register a complaint.

Getting back to the point, are you saying that I shouldn't PM you any evidence (I have never purchased any assets issued by usagi - despite day-trading on dozens of different GLBSE assets).  Should I type it up and advertise it in Securities forum and see if any investor wants to PM it to you?

Certainly an interesting spin on things that only victims have useful evidence - and everyone else should do their best three wise monkeys impression.

I don't think that's what he means. I think he is pointing out that most non-investors are blind. You and others have pointed out that BMF for example lost money. But there's no context. If you invested 100 bitcoins in BMF, you would have ended up being able to sell those for 50 bitcoins on the date GLBSE closed. That's a fact. If you invested 100 bitcoins in GIGAMINING, you would be able to sell them for 43 (at ~0.65/share). We did better than most miners, that's a fact. Yes there were companies that did better than BMF. That doesn't make mining companies a scam.

Logic just isn't your strong point is it?

Even IF we accepted that "most non-investors are blind" is that a valid reason to ignore ALL non-investors?  Let's be honest - most non-investors ARE blind.  So are most investors.   So the ones who aren't blind shold be ignored because MOST are blind?  Or is someone pre-determining that ALL non-investors are about you - and hence their accusations have no merit even before they are submitted?

And why did you start a thread claiming it to be about a general topic then start arguing your own defence?  Did I previously in this thread make any accusations against you?

You then construct a nice strawman to demolish - that I have claimed you lost money (true - and accepted by you as fact) and that that is why/how I accuse you of scamming (false).  Losing money doesn't (of itself) make ANYONE a scammer.  It doesn't necessarily even make them a bad investor.  Nowhere have I ever claimed otherwise.  So not sure why you're wasting time arguing against a contention I've never even made. 

For the record I 100% agree with you that if anyone's accusation is essentially "usagi lost me money so is a scammer"  with no other evidence then they're wrong.  If their argument is "usagi lost me money so is incomepetent" with no other evidence then they're wrong.  They-re wrong - not because you aren't (necessarily) a scammer or incompetent - but because they're saying a conclusion (scammer/incompetent) logically follows from making a loss: which is by no means a sound jump to make.

Your argument appears to be "You're wrong so shouldn't be allowed to submit evidence."  Nice try.  Maybe you should be the one who decides whether you get a tag or not - would save everyone a lot of work and obviously YOU believe you're so impartial that you can choose which evidence is valid.

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[BCB]

I also agree with Deprived.

I find it curious though that it seem that no users who were actually defrauded by usagi post in these threads.

Maybe they use sock puppet accounts because they are embarrassed they made bad investments.

If you made a bad investment, well, welcome to the world of bitcoin lending and bitcoin securities.  

It does not by itself make usgnai a scammer.

If you were defrauded or scammed and have proof please PM me with evidence.

What evidence did you rely on to make your investments.
What statements do you have that show the value of your investments.
What proof do you have that those investments no longer have value.
Please explain how you were scammed.


please do not include info about usagi's charater as that is currently not relevent.

Thanks!

To be clear - are you saying someone who wasn't an investor can't point out scamming?

It's an interesting perspective to take that if a victim doesn't realise they've been victimised noone else should point it out.

Makes it somewhat of a miracle that anyone ever gets convicted of murder - as I've yet to hear about a murder victim come forward and register a complaint.

Getting back to the point, are you saying that I shouldn't PM you any evidence (I have never purchased any assets issued by usagi - despite day-trading on dozens of different GLBSE assets).  Should I type it up and advertise it in Securities forum and see if any investor wants to PM it to you?

Certainly an interesting spin on things that only victims have useful evidence - and everyone else should do their best three wise monkeys impression.

Anyone can point out scammers.  However it seems a lot of people really don't like usgai but many of his most vocal critics didn't really lose any money.  I help track down scammers who didn't scam me all the time.  However it is usually pretty clear that scamming did occur.

With Usagi is seems to be much more grey.  He had some good investment vehicles and some bad investment vehicles.  Is usgai a scammer or just a bad investment manager.  

I'm not saying only victim's have useful evidence.   If you have evidence that usgai intentionally scammed his inventors please PM me.   But so far I have been PM'd by one one guy who lost funds and every just seems to hate usgai.

Also if you have knowledge of specifically what info was contained in usgai's deleted posts that would be helpful also.

 

[BCB]

usgai,

Please don't put words in my mouth. "I think he is pointing out that most non-investors are blind. "

What I am trying to say is that here is a lot of people who don't like you and are not creditors but still call you a scammer. 

If anyone has evidence of usagi defrauding, misleading or other wise materially misrepresenting his business please PM me.

And I will update this thread

https://bitcointalk.org/index.php?topic=133823.msg1424892#msg1424892


Right now it seems that usagi made false statments and provided inaccurate documents/formulas to represent the performance of his investments.

Then he also deleted numerous post to cover it up.

[Deprived]

Anyone can point out scammers.  However it seems a lot of people really don't like usgai but many of his most vocal critics didn't really lose any money.  I help track down scammers who didn't scam me all the time.  However it is usually pretty clear that scamming did occur.

With Usagi is seems to be much more grey.  He had some good investment vehicles and some bad investment vehicles.  Is usgai a scammer or just a bad investment manager.  

I'm not saying only victim's have useful evidence.   If you have evidence that usgai intentionally scammed his inventors please PM me.   But so far I have been PM'd by one one guy who lost funds and every just seems to hate usgai.

Also if you have knowledge of specifically what info was contained in usgai's deleted posts that would be helpful also.

The problem with pointing out information about usage has always been that usagi replies in length - whilst avoiding the key issues.  This gives the impression of a robust defence and undoubtedly deters most from raising complaints (whether those complaints had merit or not).  Also most people not only can no longer SEE what usagi claimed in the past but can't actually remember the general nature of what was claimed by usagi - so lack the available information (because usagi deleted it) to even determine for sure whether they were cheated or not.

If it's going to taken seriously then I'll type up a proper list of some examples (some i've previously raised, others I never bothered even mentioning as seemed there was interest in purusing it).  It won't be today (gone midnight here already).  In some instances I'll be able to quote exact relevant posts from usagi - in others I'll only be able to describe roughly what was said, at about what date and in which thread: if usagi then denies that, then theymos would need to use his ability to view deleted/edited posts.  But let usagi commit to a lie by denying having made such posts before theymos wastes time undeleting them - so its easy to hand the tag out afterwards when it's proven to be a lie.

[augustocroppo]

Notice that user, deprived, always trying to control the discussion with his long and boring posts when the subject can affect him. Anyone reading the securities subsection will find him there, inserting himself in every discussion where Usagi participates. If you spot Usagi in a thread, there is a great chance that deprived will follow to 'demonstrate here again that you just don't understand it'!

But it is not just that. A read in Deprived last posts is a good exercise to understand how he cleverly try to induce readers to follow his instructions. There is not one single post of deprived that a subtle command has not being given. There are always a 'you can', 'you need', 'you will', etc. in his texts.

Deprived has been constantly indicting Usagi in the last three months. Deprived and the organized felons did not save words to produce a massive amount of clueless accusations against Usagi. The consequences are very harmful not only for Usagi, but for this forum.

Evidence? Try to read this and then come back to this post. If you are able to digest that, then you will perhaps understand what I am talking about.

It is impossible to determine any meaningful information in that amount of false accusations. It became a confusing puzzle of words. It is a situation where there is no escape for Usagi. The whole thing became a "snow ball".

The administration of this forum did not intervened when was necessary. Moderators were exceeding biased against Usagi. Their lack of properly response let the organized felons push the "snow ball" further down against Usagi. No one in the forum administration/moderation acted with the necessary authority to avoid the consequences.

Now 2012 is coming to a end. Bitcointalk became a den for fraudsters and people conniving at financial criminal activities. The scam accusation section, out of control, became the stage for users come and play their emotional drama and falsely accuse other users.

[BCB]

Deprived

Yes.  I would like to read your evidence. 


Also did you invest with Usagi?

[repentance]

I don't suppose we could end the "is usagi a scammer" derail (god knows there are already enough threads discussing that) and get back to talking about the scammer tag in general, whether it has any usefulness any more, under what circumstances it should be applied, etc.

[BCB]

Probably not.

These guys HATE usagi

[Deprived]

Deprived

Yes.  I would like to read your evidence. 


Also did you invest with Usagi?

No, I never invested with Usagi.

To be clear, I don't invest anyway - I day-trade.  I believe most assets sold on here have no investment value (i.e. the expected profit from them is negative) but so long as there's someone who over-values them they're fine to day-trade.

I'll happily day-trade investments that I believe are terrible investments and, in some circumstances, I'll day-trade ones that I believe are outright scams/ponzis.  Where I won't touch an investment at all even temporarily is when I believe the issuer to be manipulating the market price UP (if they manipulate it DOWN then obviously I'm in like Flynn).  I never even temporarily held any shares in assets issued by usagi.

That I didn't invest does NOT, by the way, mean I didn't suffer any loss.  Any money being invested in usagi was money not being invested in other companies.  As someone who trades, an increase in liquidity on assets that I trade is generally a good thing.  If, by misleading investors, usagi caused more money to be sucked into his companies then that will have reduced the liquidity on other assets which I DID trade: and hence reduced my profit.

I point that out NOT to try to claim I'm owed something (any losses I suffered were entirely trivial - the amount of funds I traded with then were small anyway) but to point out that there's a fallacy in assuming that only investors can be harmed.

And IF usagi scammed/defrauded/misled (for now it's officially not proven or unproven) then the victims surely extend to those who invested in other funds/assets which held usagi securities.

Consider pirate.  Would ANYONE claim that the harm caused by his actions was limited ONLY to those who knowingly invested in him? 

[BCB]

So you believe him to be a scammer for removing liquidity from the markets?

[vampire]

I don't suppose we could end the "is usagi a scammer" derail (god knows there are already enough threads discussing that) and get back to talking about the scammer tag in general, whether it has any usefulness any more, under what circumstances it should be applied, etc.

I disagree that this topic is about the "scammer" tag, there were few topics about this in the "meta" folder. It is more usagi is trying to prove that he isn't the worst scammer out there.

@bcb

It's usagi, not usgai. Not sure why did you spell it this way it few times. No offense man.

[Deprived]

So you believe him to be a scammer for removing liquidity from the markets?

I'll detail it in PM when I get time to write it all up.

But in brief the summary would be that he scammed in various ways:

1.  Deliberately misleading investors (current and potential) so that they'd over-value his securities.  Clearly anyone who bought them based on false information suffered loss - as they paid more than what they would have had to pay had the false information not been promulgated (and they may not have invested at all had the false claims not been made - avoiding the inevitable loss associated with investment in usagi).

2.  Using assets from one security to prop up another.  That had the effect of transferring value from one asset to the other - defrauding all investors in the first (and enriching those in the second).

3.  Removing equity backing a guarantee - causing a loss to a specific set of investors (this one's fairly tricky to understand but blatantly obvious once you figure out the math).

4.  Extending an interest-free loan from one asset to another and disguising it as an investment. This actually defrauded a THIRD set of investors (sounds impossible - but true) rather than either of the parties to the loan.

5.  Attempting to defraud investors of assets that rightfully belonged to them (this one's ongoing).

6.  Repeatedly lieing about past events - defrauding anyone who believed those lies and invested as a result.

Note that none of these have anything to do with usagi's trading performance - that's incompetence not scamming and doesn't deserve a tag.

Note also that it is my contention that to be a scammer you do not necessaily have to succeed at scamming.  If you intentionally make misleading statements with an intent to gain financial benefit (defraud) then you are already a scammer.  If anyone then invests that makes you a successful scammer.  So I don't believe there is any need to prove that any specific individual actually suffered loss - just that there is a class of individuals who reasonably could be expected to suffer loss as a result (whether any actually did suffer such loss is irrelevant).

The reason I say this is simple:

Say I offer an investment and make a false statement in the process of selling it (claiming expertise I don't have, claiming I have personal capital I don't have, claiming person X is a good friend of mine - whatever, it doesn't matter).  IF the statement if proven to be false AND it could be reasonably concluded that the statement would increase the likelihood of people investing (by making the offer more attractive) then that should be sufficient on its own to award a scammer tag.  It should NOT be a requirement to prove that some specific individual actually invested because of that statement.  A lie was told to try to get investment - that's enough on its own in my opinion : it shows the person is a scammer, it's not necessary to determine how successful they were at scamming.

That only applies, of course, to false statements that would reasonably impact on people's decision whether to invest or not (and how high to value shares).  Minor details such as gender and name would NOT warrant a scammer tag even if given in the context of soliciting investment.  Repeatedly lieing about gender/name etc should, however, be taken into account as evidence that someone habitually lies and hence any unsupported claims made by them should be given less credibility than would be given to such claims from someone who had a record of usually being truthful (it's character evidence - which gos to determining the credibility of a witness).

EDIT:  removing liquidity from the market was just part of my explanation of how potential victims go far beyond just those who directly invested.  I have no intention of trying to claim losses or even particularly argue that point now that it's accepted I can submit evidence without having invested.

[BCB]

If usagi made false representations about his investments then then I would think he should be a identified as a scammer.

Where are those statements (or due to deletion: What were those statement) And where is the proof these statments were false?

I just find it curious that individuals who actually did lose money are not pursuing this as aggressively as you.

[BCB]

update

https://bitcointalk.org/index.php?topic=133823.0

[usagi]

update

https://bitcointalk.org/index.php?topic=133823.0

I just about choked when I read what you posted. I'm very upset at you because you are misrepresenting what I said. For example, you wrote "admitting to deleting material information." even though I told you I had republished the information on this thread: https://bitcointalk.org/index.php?topic=133168.0

You say "he says he "can't remember" specific facts." The facts in question are limited entirely to the mistake I made in discussion about how to value the formula. It was acknowledged by others as a mistake at the time, and quickly corrected. It was said in a discussion thread and not a thread intended to advertise BMF. The actual formula was published by me in the same post !!! and on the spreadsheet and in the shareholder letter. There was no 'can't remember' here. It was a can't remember meaning I didn't look it up while I was writing a PM.

You write "he admits to incorrectly valuing his assets:"/"I mis-spoke about the nature of the formula. I think I said "average" instead of "max" – "
this is the same as the above. It's limited to the nature of the formula, which was published in three other places and I corrected my mistake within hours of making the post in question.

You write "He admits that while he was representing  the value of his investments in the future - if  the investor how liquidated their asset would actually receive less value.: "The claim was that if someone wanted to liquidate their investments, that would be the price they could get. This is true ""
It's not looking good for usagi."

I can't believe you said that. I had spent a long time explaining to you fair value accounting and you turn around and make a statement like this. We were a fund that held securities for the dividends they provided. It would be stupid, frankly, to value them at bid price. Please read http://en.wikipedia.org/wiki/Fair_value -- this was written into our contract. I quote:

"...fair value is the amount at which the asset could be bought or sold in a current transaction between willing parties, or transferred to an equivalent party, other than in a liquidation sale."

Many of the securities we bought were in IPO and were valued at the ask merely because they had not finished their IPO. it is disingenuous, false, and frankly uneducated to say we should have valued in another manner.

Everyone could see our contract not only on GLBSE and the forum but on our webpage. What's the difference? Simple, if we buy 1000 shares of BMMO for .1, and BMMO trades for 0.09 - 0.1, we value them at .1 to stabilize the value of the fund. We do not immediately value them at 0.09. No company in the world works like that. Are you suggesting we would sell 100 shares of BMF at 0.50 and then be forced to sell the other 9900 at a lower price, merely because we had paid exchange fees or that there is a bid-ask spread on ever security? That is insane. No one could ipo like that, or operate like that.

I don't know why you are misrepresenting what I said like this but I feel compelled to point it out. if you are unable to deal with this situation fairly I would be very surprised given your history here. You cannot state that I was incorrectly valuing the fund when it was written into the contract that I would use the principles of fair value accounting (added value through analysis) and then turn around and say that the use of fair value analysis constitutes misrepresentation on my part. That's exactly what you seem to have done here and I must strongly disagree. You cannot propose a victim here because the contract stated very clearly I would value through analysis. Not that I would add value to the NAV, but that I would value based on analysis. If someone didn't read the contract... that's really not my fault.

[repentance]

Groundhog Day.

[usagi]

Groundhog Day.

Can you state whether or not you support the contention that I should have valued the portfolio at liquidation prices?

The contract stated that I would provide added value through analysis.

The spreadsheet stated that all values were estimates and listed, in plaintext, the exact formula used to value.

In the practice of fair market value, you are not supposed to value securities at liquidation prices.

Therefore it is wrong to claim that is what I should have done. QED.

[repentance]

Groundhog Day.

Can you state whether or not you support the contention that I should have valued the portfolio at liquidation prices?

The contract stated that I would provide added value through analysis.

The spreadsheet stated that all values were estimates and listed, in plaintext, the exact formula used to value.

In the practice of fair market value, you are not supposed to value securities at liquidation prices.

Therefore it is wrong to claim that is what I should have done. QED.

This thread was supposed to be about the criteria for scammer accusations, not yet another pointless "is usagi a scammer" trainwreck.  Right now it's just "same shit, different day" and to be perfectly honest you might as well close it because any pretence that it's about general principals and not all about usagi can no longer be maintained.

[usagi]

Getting back on topic I will use what BCB said as a case study of why remedy is so important.

BCB has said that I admitted to incorrectly valuing my fund and that "it does not look good for usagi" after I had explained to him what we were using principles like fair value accounting and that it was written into our contract to do so. Okay -- then since he has stated what I did was incorrect, he now needs to propose what I should have done -- i.e. what the correct way to value the fund would have been.

The problem here is that it will invariably turn out to be a form of fair value accounting, which "...takes into account such objective factors as...acquisition/production/distribution costs, replacement costs, or costs of close substitutes". It also takes into account subjective factors such as "risk characteristics, cost of and return on capital, individually perceived utility" (i.e. dividends, perceived value, and so on). [http://en.wikipedia.org/wiki/Fair_value]

It is well known that I performed interviews and did real analysis work on mining companies. I interviewed and published interviews with GigaVPS and garr of Cognitive. I have unpublished interviews with Juan of BTC-MINING and friedcat of ASICMINER. It is obvious I did analysis, it was written into the contract I would do analysis. Why is it now an accusation against me that I represented the value of my companies using fair value accounting, taking into account acquisition costs (what we paid, i.e. IPO price) or taking into account subjective factors" or "perceived value"?

I was in a much stronger position to evaluate such things than the average investor due to the work I did on BMF. It is not right that I am now being accused of misrepresenting the value of my funds for that. I am very upset people are saying that about me especially because I advertised what I was doing so widely. Therefore in this case there can be no victim because no one was misled as to the nature of what I was doing. If someone made an assumption and did not read the contract and got stung, it's their own fault. It doesn't mean I am a scammer, it means they should have hired a financial advisor.

Additional information about valuing and fair value accounting:
   The FASB describes Level 3 inputs as “unobservable.” If inputs from levels 1 and 2 are not available, FASB acknowledges that fair value measures of many assets and liabilities are less precise. Within this level, fair value is also estimated using a valuation technique. However, significant assumptions or inputs used in the valuation technique are based upon inputs that are not observable in the market and, therefore, necessitates the use of internal information. This category allows “for situations in which there is little, if any, market activity for the asset or liability at the measurement date.” FASB explains that “observable inputs” are gathered from sources other than the reporting company and that they are expected to reflect assumptions made by market participants.In contrast, “unobservable inputs” are not based on independent sources but on “the reporting entity’s own assumptions about the assumptions market participants would use.” The entity may only rely on internal information if the cost and effort to obtain external information is too high. In addition, financial instruments must have an input that is observable over the entire term of the instrument. While internal inputs are used, the objective remains the same: estimate fair value using assumptions a third party would consider in estimating fair value. Also known as mark to management. Despite being “assumptions about assumptions,” Level 3 inputs can provide useful information about fair values (and thus future cash flows) when they are generated legitimately and with best efforts, without any attempt to bias users’ decisions.

Many times, when an issue did not trade for 5 days, the formula would pull zero values from GLBSE, so I had no choice but to step in and enter a value manually. I would consult a file I kept on each company discussing everything from PPS payout % to mHash a share, charts I had created personally, comparisons by volume, etc -- interviews I had done -- electricity costs when known -- and so forth, and I looked at the value of other similar companies.. and then I invented a value. Yes, it was based on far more information than anyone else had but me, but I did invent it. Because I was supposed to.

This thread was supposed to be about the criteria for scammer accusations, not yet another pointless "is usagi a scammer" trainwreck.  Right now it's just "same shit, different day" and to be perfectly honest you might as well close it because any pretence that it's about general principals and not all about usagi can no longer be maintained.

I'll allow my own case to be used as a case study. You can argue the point if you want or not. But if you approach it as vampire has done, and try to hijack the thread then yes it does ruin it for everyone.

[Deprived]

Groundhog Day.

Can you state whether or not you support the contention that I should have valued the portfolio at liquidation prices?

The contract stated that I would provide added value through analysis.

The spreadsheet stated that all values were estimates and listed, in plaintext, the exact formula used to value.

In the practice of fair market value, you are not supposed to value securities at liquidation prices.

Therefore it is wrong to claim that is what I should have done. QED.

FWIW I actually agree that for assets like yours, valuing at liquidation price is a bad idea - a terrible idea if you do so based on volume not just highest bid due to low liquidity.  Where it was less clear was when you started valuing things a mile above Ask price because you had some belief that they'd be worth a load more in future.  If something trades in the range 0.9 to 1.0 then value should usually be somewhere in the 0.9-1.0 region (if you can buy them at 1.0 - and noone, including you, is snapping them up, then it's hard to see how they can be worth more than that).  An example of where it got really delusional was continuing to value OBSI.HRPT at IPO price (0.01) even when everyone (apart, apparently, from  you) knew he'd scammed and it was trading in a range a LOT lower.  And valuing hardware at the price you paid for it in BTC even when the exchange-rate had doubled and its BTC value was now half that.  If you take on exchange-rate risks, then the outcome of those risks has to be included in valuations - leaving things at what you paid for them (when beyond ANY doubt they're worth a lot less) just because you don't want to report a loss is NOT good practice.

Not actually sure it's scamming though - I just put it down to a combination of incompetence and a belief you were always right that meant even when someone pointed out a glaring mistake you just assumed you were right without even spending 10 seconds checking.

Anyway, got to do weekly report for my own fund - after that I'll see if I have time to type up details of my first allegation (there's only a handful in total that I'll bother with) and send it to BCB.