CoinLenders Lawsuit

[macros]

Also interested, around 1 BTC on Coinlenders.
Tradefortress hasn't responded to me. No settlement.

[HeRetiK]

Fuck it, I'm in. TF doesn't seem to even remotely try to resolve the issue and with the current BTC price legal action starts to get worthwhile even for smaller deposits.

CL balance ~2.27 BTC, I also got a couple BTCInvest shares.

[Bitcoin Scammer]

I get into it with TF every post we see of eachothers. TF needs to man up and fix problems, I mean when a whole thread is devoted to polling wether or not someone is a scammer and 50% of the people who voted claim hes a scammer...... looks, acts and walks like  a duck

[dwdoc]

Any chance some lawyers might be interested simply because it's bitcoin and that would give them high profile exposure on a new type of scam (assuming TF can be found and a case can be built)?

Class actions are a specialised area and in the end it's the litigation funders you need to convince.

IMF only funds commercial cases where the claim exceeds $5 million (I'm actually part of their class action against Australian banks).

While it's possible that there are lawyers who'd like to become the go-to people for Bitcoin related stuff, I'm not sure this is a particularly attractive case for them.  Class actions are expensive and time consuming and if you want to "make a name" for yourself you need to be able to win large awards which can actually be enforced.  A "victory" in this case could well be pyrrhic because it's not clear that TF would have any capacity to pay by the time the case was settled (especially if evidence of criminal wrong-doing emerges).

If you were a lawyer looking to make your name in the Bitcoin world, it would probably be in the area of fighting financial services regulations being applied in ways which send "legitimate" Bitcoin enterprises broke rather than trying to sue for the recovery of funds from shady businesses and individuals who have lost or stolen user funds.

You may be right.  The latest advice from the attorney is to try and get law enforcement involved either prior to or along side a civil action.

[halfawake]

Any chance some lawyers might be interested simply because it's bitcoin and that would give them high profile exposure on a new type of scam (assuming TF can be found and a case can be built)?

Class actions are a specialised area and in the end it's the litigation funders you need to convince.

IMF only funds commercial cases where the claim exceeds $5 million (I'm actually part of their class action against Australian banks).

While it's possible that there are lawyers who'd like to become the go-to people for Bitcoin related stuff, I'm not sure this is a particularly attractive case for them.  Class actions are expensive and time consuming and if you want to "make a name" for yourself you need to be able to win large awards which can actually be enforced.  A "victory" in this case could well be pyrrhic because it's not clear that TF would have any capacity to pay by the time the case was settled (especially if evidence of criminal wrong-doing emerges).

If you were a lawyer looking to make your name in the Bitcoin world, it would probably be in the area of fighting financial services regulations being applied in ways which send "legitimate" Bitcoin enterprises broke rather than trying to sue for the recovery of funds from shady businesses and individuals who have lost or stolen user funds.

If the only real issue here is price, I'd say all we have to do is wait.  The 4100 "hacked" bitcoins are already worth $3.5 million.  The price of bitcoin would have to go up about $269 for this stash to be worth more than $5 million.  If this were a normal stock, I'd say eh, that'll be a while.  But the price of bitcoin has gone up about $170 or so just in the last couple days.

But I think you've got a good point with the rest of what you're saying.  That said, I don't really expect the attorneys to do this case for free.  I remember dwdoc said they do this for 25% - 45%.  I wish that could be clarified a bit, 45% is a rather large chunk out of the stash, but I'd personally happily fork over 25% to the attorneys to be able to have the other 75% back.

Don't get me wrong, I'd much prefer the full 100% back.  But these days, it's looking like a choice between 55% or 75%.  The 45% cut really seems way too high to me, but I think 25% is fairly reasonable.  They'd be making plenty of money here, since that's $1.25 million at ten minutes ago's prices ($971).

This all assumes I can fund my share of the case out of the bitcoins that would be recovered.  If I have to fund them out of pocket, I don't really think it'd be worth the hassle, at least for me.  Might be for others who have more money in Coinlenders, however.

[The 4ner]

Any chance some lawyers might be interested simply because it's bitcoin and that would give them high profile exposure on a new type of scam (assuming TF can be found and a case can be built)?

Class actions are a specialised area and in the end it's the litigation funders you need to convince.

IMF only funds commercial cases where the claim exceeds $5 million (I'm actually part of their class action against Australian banks).

While it's possible that there are lawyers who'd like to become the go-to people for Bitcoin related stuff, I'm not sure this is a particularly attractive case for them.  Class actions are expensive and time consuming and if you want to "make a name" for yourself you need to be able to win large awards which can actually be enforced.  A "victory" in this case could well be pyrrhic because it's not clear that TF would have any capacity to pay by the time the case was settled (especially if evidence of criminal wrong-doing emerges).

If you were a lawyer looking to make your name in the Bitcoin world, it would probably be in the area of fighting financial services regulations being applied in ways which send "legitimate" Bitcoin enterprises broke rather than trying to sue for the recovery of funds from shady businesses and individuals who have lost or stolen user funds.

If the only real issue here is price, I'd say all we have to do is wait.  The 4100 "hacked" bitcoins are already worth $3.5 million.  The price of bitcoin would have to go up about $269 for this stash to be worth more than $5 million.  If this were a normal stock, I'd say eh, that'll be a while.  But the price of bitcoin has gone up about $170 or so just in the last couple days.

But I think you've got a good point with the rest of what you're saying.  That said, I don't really expect the attorneys to do this case for free.  I remember dwdoc said they do this for 25% - 45%.  I wish that could be clarified a bit, 45% is a rather large chunk out of the stash, but I'd personally happily fork over 25% to the attorneys to be able to have the other 75% back.

Don't get me wrong, I'd much prefer the full 100% back.  But these days, it's looking like a choice between 55% or 75%.  The 45% cut really seems way too high to me, but I think 25% is fairly reasonable.  They'd be making plenty of money here, since that's $1.25 million at ten minutes ago's prices ($971).

This all assumes I can fund my share of the case out of the bitcoins that would be recovered.  If I have to fund them out of pocket, I don't really think it'd be worth the hassle, at least for me.  Might be for others who have more money in Coinlenders, however.

But the price is volatile. We can't guarantee that the price will remain 5million for very long.

[repentance]

You may be right.  The latest advice from the attorney is to try and get law enforcement involved either prior to or along side a civil action.

You need to think about what outcome you want.  There's little doubt that TF has broken financial services laws and likely taxation laws as well, but generally speaking the penalties for such offences are financial so pursuing that avenue isn't going to help people recover their funds.  

If he's in NSW (which current information suggests), you can start with NSW Fair Trading but that won't go anywhere unless they can contact him - it will, however, document stuff and that could be important down the track.

As far as law enforcement goes, it comes down to whether there's sufficient evidence to prove that a crime (as defined by the Crimes Act) occurred and who would have jurisdiction.  Law enforcement can force Telstra to disgorge information related to the IP (which may or may not prove useful).  Generally speaking, if the crime occurred in NSW then they would have jurisdiction but it can get a bit complicated when federal laws may have also been broken and when events pertaining to the crime may have occurred offshore.  

I'd ask any solicitor you consult the best way to proceed if you intend getting law enforcement to investigate (international investigations always start with reporting stuff to our state police, who then contact the appropriate international law enforcement agencies).  The fact that TF spoke to the SMH about his incident could be helpful as it's publicly locked him into a particular version of events.  Obviously, you need to tell law enforcement that you believe he's lying and that he actually stole the BTC himself or arranged for someone else to do so and that his failure to report the theft supports your suspicion.

You're probably not going to want to hear this, but if you cannot prove fraud or other criminal activity, then there aren't likely to be much in the way of meaningful consequences.  Personal bankruptcy isn't a big particularly deal here, especially if you're young, and it's the most likely outcome of taking civil action against TF (if fraud can be proven, the debt can't be discharged in bankruptcy).  Obviously, a criminal conviction for fraud or theft would have longer term consequences for TF but it wouldn't necessarily help people get their funds back.  I guess a lot depends on whether you're interested in causing him grief in general or only in trying to recover your funds.

If the only real issue here is price, I'd say all we have to do is wait.  The 4100 "hacked" bitcoins are already worth $3.5 million.  The price of bitcoin would have to go up about $269 for this stash to be worth more than $5 million.  If this were a normal stock, I'd say eh, that'll be a while.  But the price of bitcoin has gone up about $170 or so just in the last couple days.

That's not the issue.  The big issue is that you'd need a litigation funder for a group action and they typically fund commercial cases, not actions against individuals who likely don't have the capacity to pay an award and who can just declare bankruptcy (or fuck off overseas and not return) at any time.  

The 45% cut really seems way too high to me, but I think 25% is fairly reasonable.  They'd be making plenty of money here, since that's $1.25 million at ten minutes ago's prices ($971).

It's based on things like the strength of the case, the expenses in mounting it (these would be significant as they'd need considerable expert testimony), the likelihood of a judgement being easily enforced (when you're up against a huge corporation, you KNOW they have the capacity to pay), etc.  Only specialised lawyers are capable of assessing each of those factors.

$1.5 million is a shockingly low pay day for lawyers in a class action, although it's doubtful the case would run for any length of time as TF likely doesn't have the funds to mount a defence.  I think one of your biggest problems is going to be convincing lawyers/litigation funders that they're ever going to see any money - what can they actually seize in order to get their 25 or 40%?

[halfawake]

You may be right.  The latest advice from the attorney is to try and get law enforcement involved either prior to or along side a civil action.

You need to think about what outcome you want.  There's little doubt that TF has broken financial services laws and likely taxation laws as well, but generally speaking the penalties for such offences are financial so pursuing that avenue isn't going to help people recover their funds.  

If he's in NSW (which current information suggests), you can start with NSW Fair Trading but that won't go anywhere unless they can contact him - it will, however, document stuff and that could be important down the track.

As far as law enforcement goes, it comes down to whether there's sufficient evidence to prove that a crime (as defined by the Crimes Act) occurred and who would have jurisdiction.  Law enforcement can force Telstra to disgorge information related to the IP (which may or may not prove useful).  Generally speaking, if the crime occurred in NSW then they would have jurisdiction but it can get a bit complicated when federal laws may have also been broken and when events pertaining to the crime may have occurred offshore.  

I'd ask any solicitor you consult the best way to proceed if you intend getting law enforcement to investigate (international investigations always start with reporting stuff to our state police, who then contact the appropriate international law enforcement agencies).  The fact that TF spoke to the SMH about his incident could be helpful as it's publicly locked him into a particular version of events.  Obviously, you need to tell law enforcement that you believe he's lying and that he actually stole the BTC himself or arranged for someone else to do so and that his failure to report the theft supports your suspicion.

You're probably not going to want to hear this, but if you cannot prove fraud or other criminal activity, then they aren't likely to be much in the way of meaningful consequences.  Personal bankruptcy isn't a big particularly deal here, especially if you're young, and it's the most likely outcome of taking civil action against TF (if fraud can be proven, the debt can't be discharged in bankruptcy).  Obviously, a criminal conviction for fraud or theft would have longer term consequences for TF but it wouldn't necessarily help people get their funds back.  I guess a lot depends on whether you're interested in causing him grief in general or only in trying to recover your funds.

If the only real issue here is price, I'd say all we have to do is wait.  The 4100 "hacked" bitcoins are already worth $3.5 million.  The price of bitcoin would have to go up about $269 for this stash to be worth more than $5 million.  If this were a normal stock, I'd say eh, that'll be a while.  But the price of bitcoin has gone up about $170 or so just in the last couple days.

That's not the issue.  The big issue is that you'd need a litigation funder for a group action and they typically fund commercial cases, not actions against individuals who likely don't have the capacity to pay an award and who can just declare bankruptcy (or fuck off overseas and not return) at any time. 

Agreed, you make a lot of good points here.  It sounds like unless we can get someone to fund this lawsuit, it's probably not likely to happen. 

[dwdoc]

Interesting developments:

I emailed Tf today and advised him that if he did not report that a crime had been committed to Australian Law Enforcement within 48hrs. that I would do so.
It was a surprise to me but he responded promptly that he would do so and followed up with a reference number filed with NSW police. Of course a group of us will follow up on this to make sure law enforcement follows through on all aspects!

[gog1]

Following balance

gog1:9.80594344

I refused his settlement proposal as I would get only 10% back and consider I deposit those coin post hack, I find that unacceptable.  Does accepting coins post hack be classified as a fraud or not.

[ninjaboon]

Interesting developments:

I emailed Tf today and advised him that if he did not report that a crime had been committed to Australian Law Enforcement within 48hrs. that I would do so.
It was a surprise to me but he responded promptly that he would do so and followed up with a reference number filed with NSW police. Of course a group of us will follow up on this to make sure law enforcement follows through on all aspects!

Great news, just send you an email.

[eikzbtc]

1.05Btc in CL , still no reply from 3 e-mails.

[tantanbit]

CL:71.59228854      in

[thisisgil]

I'm in.

Hopefully we'll be mass PMd?

[batman, not crabman]

I'm also in Australia and was going to report this as a crime (with TF being the accused, not the 'other' hacker) to my state police, however after the post above I will wait a couple of days.
If nothing happens I'm going to report my own stolen funds as a crime and see what I can do to put some heat on TF and see if any BTC 'magically' appears.

I'll keep the forum posted anyway.

[gaston909]

As TF refused my more than generous settlement offers, decided to stop logging in here, stopped responding to the majority of people, stopped any refunds what so ever despite holding balances of approx 10,000 BTC from coinlenders and a general lack of common sense.

I have reported this to the UK authorities. I was clear on my reasons for reporting it as suspected fraud and would of course much prefer to give him the benefit of the doubt... but there comes a point...

Well you know all this.

Bit sad it has come to all this. You should of just sent an email out like you said you would and offered some transparency TF.

You have had over a month. Time to get coinchat back up and "play" in chatrooms. 10,000 is a serious amount of money and you should have treated this situation more seriously.

[Bobbycoolguy]

Dam my 8grand btc investment would be worth 80k ATM
All the nice things I would have right now
I bet TF has the xbox one. Dam I don't. I bet tf has a Xbox one.. And will get the ps4 tomorrow I'm still playing black ops 2 on my 360... Dam.

[JohnHarmer]

We used to talk about Bitcoin at home, we forgot that my 6-year-old daughter could have understood many things.
She knew bitcoin, and bitcoins will help her go to college.
Not long ago she asked me angrily: "Did you lost my college fee?"
Today she told me: "Dont click on the page, you'll lose Bitcoin."

So it is not "a xbox one", for many families, this is their children's school fees, their pensions, their future.

[bradyon]

Last night I filed a report to australian federal police expressing my concerns about the dimensions of the incident, TF´s identity, the honesty of TF´s businesses and about the losses for me and other users if finally this is a ponzi scheme (thanks to the ones who helped me doing so).

I used the online form available at

https://forms.afp.gov.au/online_forms/report_a_crime

I also plan to report it to spanish police as soon as I get my home country.

If anybody wants to know what did I write in the form in order to get some suggestions, please PM me.

I strongly recommend you to try to report all this to your local police and or australian federal police.

We used to talk about Bitcoin at home, we forgot that my 6-year-old daughter could have understood many things.
She knew bitcoin, and bitcoins will help her go to college.
Not long ago she asked me angrily: "Did you lost my college fee?"
Today she told me: "Dont click on the page, you'll lose Bitcoin."

So it is not "a xbox one", for many families, this is their children's school fees, their pensions, their future.

Right, John. Many big plans are linked to those bitcoins. Some of us hopefully will be able to start again but this is going to be a severe milestone in our lifes... at many aspects

[JohnHarmer]

Agree you bradyon.
There are lots of chinese victims.
We are gathering and considering a legal action.