Sorry for duplicate posting (I posted this in the newbie forum initially) but I really wanted to share my concerns about the claims process as proposed by Zhou here.
By now it is clear that bitcoinica had their entire db and all records (apart from PII/AML and some outdated records) wiped. This is a worst case scenario. What a royal mess and one that baffles the mind considering they were dealing with a lot of customers money on a daily basis. Having a single point of failure on a virtual server hosted by a 3rd party? Wow. just wow. If I had known I'd never have put as much money into this operation as I did. However that is all in the past so let's move forward.
Zhou suggested the following approach to dealing with claims:
--- Disclaimer: Pure suggestion. NOT OFFICIAL ---
- Your bitcointalk.org profile or Bitcoin-OTC rating shows you as reputable and trustworthy. (50 Points)
- You can supply at least one transactional email you have received which perfectly matches our outgoing transactional email records. (30 Points)
- You can provide passport scans and you have provided to Bitcoinica (even if it's pending verification). (40 Points)
- The order of magnitude of your reported balance is consistent with our outdated accounting records. (30 Points)
- You can recall the balances exactly or very precisely. (20 Points)
- You have reported a losing position, with precise details. (20 Points)
- You have contacted Bitcoinica Support at least once since September 2011. (10 Points)
- Your email can be searched online and matches your identity. (10 Points)
- You can provide proof of Bitcoin address ownership (signature), Mt. Gox code you have used/obtained or accurate details of large transaction records (>2500 BTC) that match our hedging activity. (10 Points each kind of evidence)
- Another reputable member supports your claim. (10 Points)
- You have used wire transfer, BitInstant or AurumXchange to deposit/withdraw funds and they can verify the records. (10 Points)
- You have submitted the claim within the first 24 hours since the announcement. (10 Points)
Couple of points below:
- Your bitcointalk.org profile or Bitcoin-OTC rating shows you as reputable and trustworthy. (50 Points)
Wow. 50 points if you have a reputable bitcointalk.org account. Ranked higher then any verifiable things like transaction IDs, passport data, etc. I'm sorry I didn't know when I signed up with bitcoinica that it's compulsory to go to some unrelated forum and post here daily. Some people have no interest in this and have busy non-BTC related dayjobs (me). To me this is wholly unrelated. Like Bank of America returning money to customers who were good boy scouts or something? Oh you weren't in the boy scouts? tough luck. Putting this item on the top of the list introduces a kind of bias that I wholly disagree with.
I also don't see how the reputation system is workable. For example I am using another username here then on bitcoinica (and this is on purpose). I also chose to hide my email. How can Bitcoinica match Bitoinica users to Bitcointalk.org users? And even if they can how would they establish 'reputation'? (Read all posts by members? I think not). And giving points based on friends supporting your claim... what is this even supposed to mean? Any prudent investor/speculator will keep their deposits and positions private. I don't see how getting supports from friends promotes the claims process in any way apart from allowing you-help-me-i-help-you schemes between people making claims look more legit.
- The order of magnitude of your reported balance is consistent with our outdated accounting records. (30 Points)
The reason this won't work is because your records are outdated. In my case I sent a significant USD wire transfer to Bitcoinica that cleared only days before the hack. Yeah that is money in the bank for Bitcoinica but no 30 points for me. No sir.
- You have reported a losing position, with precise details. (20 Points)
Ah so customers that came in at the time when Bitcoinica started paying interest on deposits and used Bitcoinica as a USD+BTC savings account that had no interest in speculation (like me) will lose out here. Sounds like a great idea.
- You can recall the balances exactly or very precisely. (20 Points)
And you are going to verify this *how* exactly? Basically what you are saying is that if the user picked the 'Exact' option from the dropdown they get a free 20 points instantly. I would argue that because of daily interest on deposits combined with 5 decimals of precision, almost no account holder will know their *exact* balance.
- Your email can be searched online and matches your identity. (10 Points)
Right, because we all know that putting your email address online so they can be harvested by spammers and impersonators is best practice. +10 points.
- You have submitted the claim within the first 24 hours since the announcement. (10 Points)
Yeah sure. Because all 5500 bitcoinica customers have nothing better to do then read 70+ post threads on bitcointalk.org all day. People have families, jobs, vactations, etc. Bitcoinica has not notified any customers by email of the claims process and the main website has been spotty at best (non www. domain did not work. Certificates were invalid suggesting the claims process could be bogus, etc.)
if your user ID is less than 4500, I'll definitely make sure you get your money back
Let's check my user id... hmm 47**. Well I guess I might as well wave bye bye to my money. Again I started using bitcoinica for the interest on deposits back in February. I put a large chunk of my savings here (yeah, shame on me). Please tell me why I am an inferior bitcoinica customer again?
Don't get me wrong - I think Zhou did a lot of good stuff with Bitcoinica and really appreciate the information he shared during this incident given the total lack of info from Bitcoin Consultancy, but he clearly dropped the ball when it came to security and I don't think he is the right person to handle the claims process since he seems to have a personal incentive to protect his reputation that might adversely influence the process.
The claims process should be based on facts. Meaning MTGOX codes, Wire Transfer Codes, Blockchain transfers, AML/PII docs and the like. It is a big Jigsaw but the only way. Bitcoinica should start working with MtGox, BitInstant, ArumXchange and other transfer services pronto. All money (be it BTC or USD) that came into Bitcoinica should be verifiable though other institutions.
And if it sounds like I'm angry - It is because I am.
--- Disclaimer: Assume that the suggestion is used without modification. ---
Well, none of these measures work individually, for sure. That's why we need 100 Points for full refunds.
If you are reputable on this forum, submitted passport scan and at least one other proof, you can get 100 points.
If you're not active on forums or OTC and never verified. Never mind. If you honestly reported a losing position (and we have pretty current position reports), sent an email to us ever, gave accurate balances up to two decimal points (20+30 points) and used Mt. Gox and Bitcoin to deposit. Full refund!
Even if you can't give us exact details, we can offer a partial payment for you and the remainder will come later. We are not eating your money.
--- Disclaimer: Assume that the suggestion is used without modification. ---
EDIT:
I'd like to add one criterion for the suggested plan: Reported very close balances and positions (less than 0.5% upwards or 1% downwards) compared to our non-current records. (50 Points, but disqualify the orders of magnitude criterion)
We're not telling you the date of our record, so if there're no balance changes after that date, we'll give the most recognition. This applies to interest-earning accounts with not many activities.
The fact is, we have all kinds of records, so it's very hard to submit false claims without contradictions. I have spent about 100 hours in total monitoring orders execution, user balances change, deposits, withdrawals, support requests and position liquidations since the launch of Bitcoinica. The memory itself can prove something. And I have a previous project selling virtual goods and facing a lot of credit card fraud - I have trained myself identifying fraud.
. numbers transaction, the date, time .. It sounds promising .. In order to prove ownership of email - I can sign the message key. similarly to wallet