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Author Topic: BREAKING: SEC Charges pirateat40 With Running Bitcoin-Denominated Ponzi Scheme  (Read 44400 times)
danieldaniel
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July 25, 2013, 10:36:38 AM
 #81

So now we know he stole >250K BTC and had 100k BTC left when he was interviews. We also know the SEC has proof there are people who were net winners (it's in the document he claims to be true).

I guess claw-backs will be hard however because there were so many pass through. It's tough to prove that any single individual really has net gains.

Theymos posted on the forum he had a net gain but yes, it will be very hard to figure out. Also I doubt there were that many who did gain and even if there was claw back would it be USD at the time or BTC?   If BTC and they sold, that would hurt.


Hm.  I might have had a net gain with one of the PPT's, but I never really calculated it... So unless they subpoena paybt.c, that would be really hard to figure out.

Also, I guess they were allowed to use the information I gave them over the phone (even though I'm <18)!  They posted my state on the complaint.

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July 25, 2013, 11:22:13 AM
 #82

Don't understand why you would start such a thing, neither did he have any experience whatsoever in hiding his true identity. Which is the funniest part.

It's karma, and it has been served, so far...

However though, I do have to give the guy some sort of credit for making it this 'far'. I guess this points out as well how easily the bitcoin community can be fooled.


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July 25, 2013, 01:00:04 PM
 #83

Also looks like Mr. Moustakis asked the Eastern Texas courts for the right to appear "Pro Hac Vice".  Simple version Pro Hac Vice is a request for an attorney to practice in a specific case outside of their jurasdiction.  Rather than have the plantiff (SEC) be represented by a TX based attorney they petition the courts to allow Mr. M (who has license to practice law in NY) the right to appear in the TX court.  It would appear the request has been granted.

People in this forum living in Eastern Texas who did not "invest" with Pirate, go register for jury duty, you might get lucky and be assigned to this case, that's a courtroom session I'd pay to watch...
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July 25, 2013, 01:00:20 PM
 #84

Don't understand why you would start such a thing, neither did he have any experience whatsoever in hiding his true identity. Which is the funniest part.

It's karma, and it has been served, so far...

However though, I do have to give the guy some sort of credit for making it this 'far'. I guess this points out as well how easily the bitcoin community can be fooled.

The thing is with ponzi schemes or other scams it is more or less a crime of opportunity and probably not a long con, we have no idea if Mr.Shavers started the company with good intention and just decided half way through that it is more money to ponzi(which will always be true), its simply easier to steal than to actually work and its takes a person with serious discipline to not do the wrong thing especially with people throwing money at your face

Its pretty crazy how they work but its not like this is a brand new thing so many ponzis have been done and so many people have been left in financial wake

it all boils down to not investing more than what your willing to lose because more times than not simple minded investors or those who do not do it professionally are willing to bet the house on schemes like this
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July 25, 2013, 01:01:36 PM
 #85

And record it if you're chosen

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July 25, 2013, 02:23:05 PM
 #86

Also looks like Mr. Moustakis asked the Eastern Texas courts for the right to appear "Pro Hac Vice".  Simple version Pro Hac Vice is a request for an attorney to practice in a specific case outside of their jurasdiction.  Rather than have the plantiff (SEC) be represented by a TX based attorney they petition the courts to allow Mr. M (who has license to practice law in NY) the right to appear in the TX court.  It would appear the request has been granted.

People in this forum living in Eastern Texas who did not "invest" with Pirate, go register for jury duty, you might get lucky and be assigned to this case, that's a courtroom session I'd pay to watch...


Shavers already cooperated and gave the SEC tons of info...

My guess: there will be no trial, he will settle.

And investors will get nothing.
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July 25, 2013, 02:26:52 PM
 #87

Also looks like Mr. Moustakis asked the Eastern Texas courts for the right to appear "Pro Hac Vice".  Simple version Pro Hac Vice is a request for an attorney to practice in a specific case outside of their jurasdiction.  Rather than have the plantiff (SEC) be represented by a TX based attorney they petition the courts to allow Mr. M (who has license to practice law in NY) the right to appear in the TX court.  It would appear the request has been granted.

People in this forum living in Eastern Texas who did not "invest" with Pirate, go register for jury duty, you might get lucky and be assigned to this case, that's a courtroom session I'd pay to watch...


Uhm, you don't "register for jury duty." As a person aged 18 or older you're automatically enrolled without a choice in the matter.

Based on the location info he's only 10m away from me but we're in different counties so I wouldn't be called regardless. Ironically I did get called to one from my county just last week!

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July 25, 2013, 03:09:28 PM
Last edit: July 25, 2013, 03:23:17 PM by DeathAndTaxes
 #88

Based on the location info he's only 10m away from me but we're in different counties so I wouldn't be called regardless. Ironically I did get called to one from my county just last week!

It is federal court, the district is half* the size of Texas so you might get to "attend".  

Ok so not half but maybe a quarter.
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July 25, 2013, 03:20:09 PM
 #89

Also looks like Mr. Moustakis asked the Eastern Texas courts for the right to appear "Pro Hac Vice".  Simple version Pro Hac Vice is a request for an attorney to practice in a specific case outside of their jurasdiction.  Rather than have the plantiff (SEC) be represented by a TX based attorney they petition the courts to allow Mr. M (who has license to practice law in NY) the right to appear in the TX court.  It would appear the request has been granted.

People in this forum living in Eastern Texas who did not "invest" with Pirate, go register for jury duty, you might get lucky and be assigned to this case, that's a courtroom session I'd pay to watch...


Shavers already cooperated and gave the SEC tons of info...

My guess: there will be no trial, he will settle.

And investors will get nothing.


This, they have too much info for him not to have cooperated.

Absolutely right. It looks as if he is the one that gave them btc amounts they used. They researched the $ bank amounts to verify those amounts. If he was bright enough to fool that many people out of their btc why wouldn't he have been bright enough to just short the amount he told the SEC by 20k btc? Even if he only sits on a wallet with 1000 btc for 5 years he could still be sitting on a fortune that will let him settle out of court and retire. The investors get nothing - he's still rich.

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July 25, 2013, 03:31:28 PM
 #90

Next up: Hashking aka Sam Theofanopoulos, 7262 W Benton Dr Frankfort, IL 60423

I really hope they go after all the PPTs and the Starfish too.
I really hope they go after BFL too.
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July 25, 2013, 03:44:00 PM
 #91

Was this a ponzi scheme aimed at luring in investors or lenders for a real or fake mining company, or something else? I don't know what his 'company' is.
Grab a beer and start here.
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July 25, 2013, 03:59:50 PM
 #92

Was this a ponzi scheme aimed at luring in investors or lenders for a real or fake mining company, or something else? I don't know what his 'company' is.
Grab a beer and start here.

Based on that thread, he sucked in a lot of people that I wouldn't have thought would fall for his BS. But then again, when I first came to this forum theymos had an ad for a Ponzi in his sig line.

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July 25, 2013, 04:01:47 PM
 #93

Based on the location info he's only 10m away from me but we're in different counties so I wouldn't be called regardless. Ironically I did get called to one from my county just last week!

It is federal court, the district is half* the size of Texas so you might get to "attend". 

Ok so not half but maybe a quarter.

Whoa, wasn't aware there was a difference, lol. Anyways, I never get lucky... I've been called to jury duty 5x so far... all 5x I got sent home... always depresses me... if I'm stuck there for 6+ hours they could at least let it be for something, =S.

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July 25, 2013, 04:24:09 PM
Last edit: July 25, 2013, 04:35:54 PM by deltanine
 #94

Also looks like Mr. Moustakis asked the Eastern Texas courts for the right to appear "Pro Hac Vice".  Simple version Pro Hac Vice is a request for an attorney to practice in a specific case outside of their jurasdiction.  Rather than have the plantiff (SEC) be represented by a TX based attorney they petition the courts to allow Mr. M (who has license to practice law in NY) the right to appear in the TX court.  It would appear the request has been granted.

People in this forum living in Eastern Texas who did not "invest" with Pirate, go register for jury duty, you might get lucky and be assigned to this case, that's a courtroom session I'd pay to watch...


Uhm, you don't "register for jury duty." As a person aged 18 or older you're automatically enrolled without a choice in the matter.

Based on the location info he's only 10m away from me but we're in different counties so I wouldn't be called regardless. Ironically I did get called to one from my county just last week!

I live in the same county and have been summoned for jury duty in August.

Keep you fingers crossed everyone! Smiley

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July 25, 2013, 04:31:06 PM
 #95

Was this a ponzi scheme aimed at luring in investors or lenders for a real or fake mining company, or something else? I don't know what his 'company' is.
Grab a beer and start here.

Based on that thread, he sucked in a lot of people that I wouldn't have thought would fall for his BS. But then again, when I first came to this forum theymos had an ad for a Ponzi in his sig line.
Hindsight is 20/20, but I think some people forget how much of a well-orchestrated long con BS&T was. Pirate was one of the top-rated OTC members of all time. Also, look at the start date of that thread—he managed to run it for a long time.

Another thing: if you look at the threads in the lending forum of last year, people were taking out loans denominated in BTC with higher interest than credit card rates. The fact that many loans were made at 2% weekly made 7% weekly seem less crazy (to some) (I think).
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July 25, 2013, 04:31:53 PM
 #96

Next up: Hashking aka Sam Theofanopoulos, 7262 W Benton Dr Frankfort, IL 60423

I really hope they go after all the PPTs and the Starfish too.
I really hope they go after BFL too.

I second this.
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July 25, 2013, 05:46:34 PM
 #97

Was this a ponzi scheme aimed at luring in investors or lenders for a real or fake mining company, or something else? I don't know what his 'company' is.
Grab a beer and start here.

Based on that thread, he sucked in a lot of people that I wouldn't have thought would fall for his BS. But then again, when I first came to this forum theymos had an ad for a Ponzi in his sig line.
Hindsight is 20/20, but I think some people forget how much of a well-orchestrated long con BS&T was. Pirate was one of the top-rated OTC members of all time. Also, look at the start date of that thread—he managed to run it for a long time.

Another thing: if you look at the threads in the lending forum of last year, people were taking out loans denominated in BTC with higher interest than credit card rates. The fact that many loans were made at 2% weekly made 7% weekly seem less crazy (to some) (I think).

There's no hindsight necessary. As user CornedBeefHash, before I deleted all my posts and started over, I had a thread calling out Pirateat40, Clipse and Goat. I wanted them to explain how they could offer such great returns without it being a scam or somehow criminal. No one but Holiday (who has now deleted all of his posts and disappeared) agreed with me. Goat was the only one of the three that actually responsibly answered questions in that thread. The shithead Pirate just made snide comments like he always did and became his typical angry asshole self (the reason I think Josh is the same as Pirate because they act the same when questioned). Gmaxwell also appeared in that thread and accused them of illegal activity. Gmaxwell was all over IRC at the time telling everyone that it was a scam or some sort of illegal activity and NO ONE listened. I'm sorry but I don't feel the least bit sorry for the "investors" here. Stupid people will always be parted from their money. If not Pirate and Clipse then someone else will do it.

BTW Goat: Aren't you at least a little bit nervous over what's happening? You were one of the Pirate pass-throughs and had your own offerings on GLBScamE at the time. If I were you I be shitting a brick of worry about now.

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July 25, 2013, 05:48:01 PM
 #98

Next up: Hashking aka Sam Theofanopoulos, 7262 W Benton Dr Frankfort, IL 60423

I really hope they go after all the PPTs and the Starfish too.
I really hope they go after BFL too.

SEC? Why would they? I don't like BFL as much as the next guy, but SEC has nothing it wants from BFL.
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July 25, 2013, 06:20:03 PM
 #99

Oh, I agree with everything you said. 7% weekly was obviously unsustainable. However, I'd like to quote you here:
I'm sorry but I don't feel the least bit sorry

 Wink Tongue
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July 25, 2013, 06:37:15 PM
 #100

Can anyone work out the number of coins in 1DkyBEKt5S2GDtv7aQw6rQepAvnsRyHoYM when he stopped paying out?

I think it was a lot more than the 193,319 BTC he apparently didn't return to investors.
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