Bitcoin businesses who aren't AML/CTF compliant have been warned about this likelihood for a long time. There's really not much of an excuse for not being prepared for it either on the operator side or the user side. When businesses are providing financial services without requiring KYC information, users know damned well that those businesses are at risk of encountering legal problems for AML/CTF and tax evasion issues. Operators and users are perfectly free to ignore that risk, but they knowingly do so at their own peril.
+1, it doesn't matter how you cut it, the moment you call something a security (or call it something else but the same thing thus giving this feeling of security) there's an implication that:
a) There's a limited liability company (ie. LLC, Pty whatever) that's running the exchange, I haven't read through this entire thread so apologies if it's already been answered but was there? If so then you have the powers of the jurisdiction it was formed in (which could be none or many) and now I'd assume there's something tangible you'd consider prosecuting.
b) That the listed assets exist in more than just the fictional 'bitcoin company' definition and are also potentially LLC's. Some assets I've seen on GLBSE are worthy of operating as normal companies but others left a lot to be desired as far as reporting (just making them readable would have been nice).
I'm not surprised that a federal regulating authority might come in (perhaps in relation to another recent far larger scam from 'he who shall not be named') and force the shutdown and identification of all share holders. If they had 1 person in particular 'by the balls' as it were he'd be staring down the barrel of 20 years+ in a penitentiary. The mere existence of pass throughs implicated GLBSE as a secondary funding location that, I assume, a financial authority would be seriously interested in.
With relation directly to Nefario, I hardly know the guy but for all we know he could be operating under the direction of a far higher legal authority. Meanwhile his lawyer would be the only contact.
Where such businesses have actively misled their users with statements that their service is not at legal risk because...Bitcoins, then a "scam" label is probably warranted. For the most part, though, it would be more accurate to label the operators of such services as arrogant, reckless and incompetent.
I wasn't there but I heard the response was to simply point out that you could move jurisdictions. While that statement is 'true' it fails to consider the long arm of the law of large governments who are participating Globally too (ie. there's some synonyms for why Bitcoin is sold as a good idea). I personally don't think there's anything wrong with having AML requirements & enforcement especially when there's third party brokerage. There are very few Bitcoin businesses that can choose to ignore the fact they still operate in the jurisdiction in which they are formed.
Either way, I never invested in anything on GLBSE, didn't feel comfortable, the hit on the Bitcoin price is kinda annoying but by the same token I personally believe that at least some form of regulation is helpful especially when it comes to having Bitcoin adopted effectively by the masses.
Seriously, tell me that's not US government language.
It's standard language for all 34 FATF member nations, which is why you'll find financial institutions all over the world talking about AML/CTF/KYC requirements. The administrative burden for complying with those requirements is enormous, but small entities don't have the the resources to wear the consequences of non-compliance.
+1, nuff said.
Stu
P.S. This is my personal views only and is based on nothing more than things I've read and considered. Potentially none of it could be factual.
