Long I know but please bear with me, here is potentially an interesting case study on BTCJam ethics and operating procedures…
Our players today:
User A: Eric,
https://btcjam.com/users/492138 ,
https://www.facebook.com/eric.palmer.718, Forum ID: Einvestmentstrade
User B: Kelley,
https://btcjam.com/users/512409,
https://www.facebook.com/AdamTehBeast?fref=ufi, Forum ID: Servsunlimited
Our two Users open up Bitcointalk Forum ID’s within minutes of each other. Both decide to open up BTCJam accounts, get verified and within a few days of each other take loans out. User A writes a nice Recommendation for User B and User B does the same for User A. User A is claiming he wants to buy stock for his ebay store while User B wants to start a loansharking business…(OK…pretty obvious this guy is a piece-of-shit but User B is not the point of this story...in retrospect Auto-Invest is a very bad idea).
User A takes his loan out for circa 1BTC (
https://btcjam.com/listings/56087-a-little-push-to-help-my-business-) and apparently makes his first monthly payment early to the delight of his investors (including User B who has invested .0001 BTC). User B has taken out his loan by now however repayment is on a weekly basis (
https://btcjam.com/listings/55913-new-business-startup).
As User B misses his first payment of course we investors all start doing a bit of the basic due-diligence that we admittedly should have done prior to investing but would have expected BTCJam to conduct. Investigating User B a bit further one clicks on his profile page to find that glowing recommendation from his friend User A “Eric”…sadly though, according to the profile page of User B, friend Eric has been since end of February 2016 suspended by BTCJam; when clicking further to Eric’s User page though (
https://btcjam.com/users/492138) there is no sign of this suspension …one only finds an active loan that is actively being repaid.
On the surface all seems fine. User B is a scammer, but apart from being suspended and having written the recommendation User A is no problem. As the months go by the loan continues to be serviced, Notes are traded, BTCJam earns money…everyone is happy.
Except User A never got his money. User A is contacted in connection with User B via Facebook and he demonstrates a very believable case for this fact. He acknowledges his association with User B. It is pretty clear also from his history that if he had gotten the money in the first place he would not be paying it back just like his buddy User B. The supposed store that User A was running does not exist. These two signed up to BTCJam with the intention to scam.
I believe the scam was successful in the case of User B, however User A got caught somehow by BTCJam before funds were distributed and they did the right thing by suspending him. What is happening now though I am not sure…my suspicion is that BTCJam is making payments automatically out of the remaining principal invested, allowing them to keep their statistics and make money on the trading of Notes as well benefiting from the price fluctuations in BTC.
Another example of this type of suspicious activity can be found on
https://btcjam.com/listings/55564-localbitcoin-seller-startup. In this loan one of the Investors has also surmised that the payments are being made automatically from the principal loan of the investors… eventually this money will run out and the loan will go into default.
I will not deny that my overall feelings about BTCJam are pretty negative and as a result of their actions over the last few months I stand to lose a fair amount of my investments in general. I have enough of “normal scammer” loans littering my BTCJam portfolio, this one documented above is just too suspicious to ignore.