Not sure why Ukyo lets crap like this and Exchange.ESIF list on Bitfunder when it's immediately obvious just from the prospectus that they're scams. There's now plenty of reasonable or half-reasonable assets on the platform - and scams like these don't actually attract much volume (and what they do attract the exhcnage only gets to see about 1.333 times before it vanishes).
Anyway, here's why this one is a scam. Some of the stuff here you'll have to check out yourself - other bits you'll have to take my word for (or ask Ukyo to check).
1. His description says "This is not a public company or corporation, but is a private business. We are using this service to manage shares and dividends. We cannot prevent shareholders from selling or trading their shares to outsiders using this service, but it is the best system available so we are using it." Yep - according to this he wasn't listing to sell shares himself, but to help manage the accounting. And he can't help it if some shareholders trade on it.
But that's not what happened. Right after listing he slung up a block of 100k for sale. We know it was him - as all the shares except 17 (yep - only 17) were in a single account. And since then he's been trying to sell non-stop including posting a totally laughable news release. So we aren't off to a good start are we - when he lies about the primary intention of listing.
2. He hasn't even identified the business. I'd have thought Ukyo would have the self-respect just to laugh at him and tell him to fuck off when he asked to list without identifying the business, but apparently not. Think everyone knows the track record of past companies that didn't even identify their business.
3. Another common give-away for scammers is that they don't actually mind what price they sell shares at : after all they haven't got to protect investors' interests or raise a specific sum, they just want whatever they can get. So I thought I'd see just how low he'd sell shares at.
I slung up a buy order for some at 0.0001 - that's 1% of the price he was listing for sale at.
Not long after :
2013-03-01 21:30:29 BUY: (Biz27B-6): 1 @ ฿0.00010000/ea
Hmm, what to do next? Well obviously put it up for sale just below his own sell orders (delay is mainly because I didn't notice I'd bought it).
2013-03-02 19:06:44 SELL: (Biz27B-6): 1 @ ฿0.00990000/ea
Ah well, only 1 share - would be different if he did it on a bunch.
Like:
2013-03-09 14:10:34 ฿0.00995000 1 ฿0.00995000
2013-03-09 14:09:31 ฿0.00200000 500 ฿1.00000000
Yup - selling 500 at 20% of price he lists at, then immediately buying 1 off his main Ask so last bid is still high. Just hope whoever got that 500 knows to relist under him and keep lowering price down. Do I KNOW that sale is him? Nope - but it's easy enough to check from cached ownership lists on Bitfunder. Just can't be bothered to do it myself - as I don't need convincing he's a scammer.
4. None of the above is conclusive proof of scamming individually. Put together maybe it is. But here's the real kicker. He talks about having transparent accounting - where investors can see revenue and expenses go in and out of the business' accounts. Now I was sceptical of this - how can it be transparent when we have no idea who is paying or being paid by him? How can we be sure he's not just funelling BTC through a mixer to fake up his accounts? Turns out I was wrong - it IS transparent and laughably so.
I had a look at the accounts addresses and was amazed and amused by what I saw and by his total stupidity.
The revenue account (starts with 1BizRev) receives funds in from various addresses and sends funds on to the Expenses account (starts with 1BizExp). The expenses account then disburses these funds to various addresses.
Where it becomes transparent is because if you look at these other addresses you find some where ALL the account does of significance is receive from his Expenses account then an hour (or less) later send it back round the loop to the Revenue account. Yep - he was too dumb even to use a mixer and made his accounts totally transparent - he's cycling the same cash around to make it look like there's business happening.
Here's some examples :
http://blockexplorer.com/address/17MVKyVjFsMAnsFKidGmJCWGmUfstLUXRareceives 1.3 BTC from his expenses account (which received that from his revenue account) then 10 minutes later (yep only TEN minute later) he sends exactly same amount back to the Revenue account.
http://blockexplorer.com/address/1NsnBcrk6jJQGcwWCCAmBHcdG9VJofSGRAThis time he waits an hour before sending the funds on around the loop.
I spat coffee all over my keyboard when I first saw just how obvious it was - had expected it to take at least 10 minutes to work out just how he was cycling the funds around. I haven't looked at half the addresses. Would assume some will be receiving withdrawals from Bitfunder and pushing them round the loop - the size of his transactions has slowly grown once he sold some shares so had some cash to move around. And would also assume some of expenditure transactions will be deposits to his alt accounts on Bitfunder so they can buy shares and make it look like there's demand plus assist his pretence of having private investors.
Anyone still think it's legit (other than Ukyo)?
