Topic: Onus & Remedy in Scam Accusation Threads - page 3. (Read 6488 times)

I warned you that if you continued to misrepresent me I would post the discussion we had. I'm going to write it up now.

BCB is not dealing with this case in a fair and equitable manner.

I sent BCB the following information in PM:
Hi. The charge of me misrepresenting the value of my assets seems central to this discussion. I would like to point out some things.

One, the spreadsheets were published on tsukino.ca/bmf, which was a wordpress site which I have deleted. So it is unrecoverable. however, you can know what was published there because I re-published the holdings of BMF here: https://bitcointalksearch.org/topic/nyancpa-final-claims-process-updated-september-22nd-2013-133168

In response to this, BCB posted:
"the spreadsheets were published on tsukino.ca/bmf, which was a wordpress site which I have deleted. So it is unrecoverable. "
* admitting to deleting material information.

In the above, BCB has failed to account for what I said, that I republished the holdings of BMF. When he says that I "admit" to deleting "material information" he is blowing this out of proportion. The information was not material at the time it was deleted. Furthermore, thanks to puppet an eskimobob and not least myself there are copies of our holdings online. Taking what I said as "admitting" to deleting "material information" is a misrepresentation of what I said.



Point two was, "I had written into the contract that BMF would provide added value to investors via analysis. This was the value that I had put in to the spreadsheet initially. At a certain point in time (august?) EskimoBob, Puppet, Deprived, et. al began complaining that this was a form of falsifying NAV. So we had a long discussion. During this discussion I asked them if pulling data off GLBSE was the correct thing to do. They said yes in general (people thought it was a better idea) so I downloaded some kind of script to pull data off GLBSE and used a formula which looked at 24hr avg, 5 day avg, etc. and picked either the max or the average -- can't remember, the point being that it was data based directly off GLBSE. On the spreadsheet I announced this change and posted the exact formula. I also posted this formula in a letter to shareholders posted on the securities forum. However, in a separate discussion (not intended as advertising) I mis-spoke about the nature of the formula. I think I said "average" instead of "max" -- and this was taken as an attempt to defraud. Nothing could have been farther from the truth."

In response, BCB posted this:
he admits to incorrectly valuing his assets:
"I mis-spoke about the nature of the formula. I think I said "average" instead of "max" – "
He admits that while he was representing  the value of his investments in the future - if  the investor how liquidated their asset would actually receive less value.:

This is a complete 180 degree turn around from what I said. I did not, absolutely not admit that I incorrectly valued my assets! I am extremely upset that BCB would lie about what I said in this manner.

Point three was,
"After I had gone through this painful process the same people (eskimobob, deprived, puppet) and others continued to complain. So in desperation I ran a shareholder motion about the valuation. I also provided three independant ways to calculate the value; the share count, from the original spreadsheet, the analysis value I had written into the contract which was my duty to provide, and the new column valuing the holdings by using the GLBSE data. I went out of my way to provide as much information as I could. What was EskimoBob and puppet's response?

They produced a spreadsheet using the minimum of last traded price, 5 day avg, and bid -- designed to make my holdings look like crap. The value ended up around half of what I had posted, and they used this to say I was lying. The claim was that if someone wanted to liquidate their investments, that would be the price they could get. This is true but also extremely misleading -- as a fund we were more interested in future value and collecting dividends. It is very unfair to say I was misleading investors because I painted a picture of future value and dividend value, instead of telling them what they would get if they sold everything in a market order.

The problem with valuing that way is we always instantly lose money. if I buy at the ask and then value at the bid, I have to report a -5% or -10% on every trade and that is not logical. No fund operates that way. Not FDBF, SS, M.ETF, MU, GBF or anything. If we pay 100 BTC for BTC-MINING for example, we would keep the stock at 100BTC until something major or material turns up about the company or until the stock price crashed. I was never concerned with day to day fluctuations of 2% here, 5% there. It was my job to provide added value through analysis. That's my feeling. I hope it helps."

In response to the comments BCb made I issued him the following clarification in PM:

I told him in PM that I did not appreciate the hostile way he was treating me. He responded by saying he never asked me to work with him and that I could not bully him into doing what I wanted () I told him, I would not work with someone who was being hostile to me in this manner. Then he posted this:


I contend that BCB is misrepresenting what I told him and is treating me in a hostile manner. I believe he is using his position of repsect in the community, gained from dealing properly with other scammers, to pile on yet more baseless claims against me. For all the talk of evidence and fairness, BCB has responded to me with innuendo and hostility, compared me to pirate, and ignored my statements of fact about how we ran BMF.

So while it is clear that a Lot of guys don't like usgai.

He is obviously not a very good investment manager

He also a lier and probably Delusional  he may still not be a scammer.

If a person is greedy and or dumb enough to invest in a company paying unrealistic returns who are we to stop them. The fact that this form allows that cesspool of a lending forum to exist with only a disclaimer it is pretty clear that it is up to the buyer to beware.

I think victim who has lost money is required for a scammer tag

The mods have said the same thing countless times. In trhe EskimoBob/YARR thread, badbear ruled that there must be financial loss, and that if I only lost my time and not money as a result of an attempted scam the accused would not get a tag.

By that arguement then Buttery Fly Labs is a scammer.
And BTCJam is a scam.

I think there does need to be a victim. It is our job to regulate another person belief? 

I may not believe you have a rocket ship in you back yard but I would believe Richard Branson. And if Richard Branson rocket ship fails to make it to the moon does that make him a scammer?

I suspect this is the intention...

I could claim I built a rocket in my back yard and offer to sell flights to the moon in it.  Obviously noone would fall for it - so by usagi's definition I wouldn't be a scammer as there was no victim and no damages.

By everyone else's definition I'd be a scammer - just a very bad one who was never going to make a profit from his unsuccessful scams.  A scam is a fraudulent business scheme - there's no requirement for it to actually succeed in defrauding anyone for it to be a scam.

So under your proposed ruleset Pirate doesn't get a scammer tag until he's defaulted, even though he was offering impossible returns and clearly running a Ponzi from day one.  How is this a more equitable system?  This only benefits the people looking to scam.

The name of the lawyers is a fact.

I'm. Looking for facts and you can not provide any.

You use lots of words to say the same things over and over again.

Please post a copy of the invoice from the lawyer.

Please also post a copy of your contract.

Thank you.

Huh? What?


?


You're not welcome. Why would I provide you his name? I paid a consultation fee and didn't retain him. It has nothing to do with anything I'm being accused of. He certainly won't talk with you on the phone about my case unless I authorize him to, and he will likely charge you money for the telephone consultation. This is a bit of a dead end and doesn't make sense.

You're being hostile to me. You've misrepresented what I told you in PM. You are intentionally or otherwise failing to understand that the BMF contract stipulated that I would provide added value via analysis. And that vampire's contention is without merit because we had a mandate to buy and hold as a long term investment fund. I have discussed the principles of fair value accounting with you in three places now; twice in PM and once in a reply in this thread. If you cannot admit that you have grossly misrepresented what I said, then I will post our conversation in PM. I can't believe you are unable to comprehend what I said about our contract and how we valued stocks.

We wrote it into the contract friend. We did what we said we were going to do. And no one lost any money just because we followed fair value accounting principles. Unfortunately it seems you're a little short on facts.. and what facts you have you are twisting... You make me sad, I had thought you would treat this fairly.

Wow. That is right out of pirates play book. You learned at the feat of the master.

It is not looking good for usgai.

Usgai. Please site the name and address of the "Internet defamation lawyer" you consulted.

Thank you.

STOP LYING.

It has not been shown that EskimoBob lost money as a NYAN.A holder. You have NO RIGHT to say that and NO EVIDENCE. This is a prime example of how false claims and emotion can ruin someone. Makomk you are being very foolish. Almost 1000 bitcoins were used to buy back NYAN.A before the GLBSE close and support a price of 1 bitcoin per share. I am now in a claims process where all NYAN.A holders will receive 1 bitcoin per share.

How dare you sit there and state that EskimoBob lost money. it's because of stupid, irresponsible comments like yours just now that I am in this situation.


No I did not say he should not be allowed to accuse me.


No I did not. You are lying. I said I would follow a community approved process. That process has now been completed by burnside on BTCT.CO and EskimoBob has his 40 shares.


See? You quoted me but you do not have the intelligence or the respect to read what I said.

The damage you, and people like you have caused me is nearly irreparable. You owe me an apology.


I'll be square with you: You need to fuck off. You don't have the intelligence or reading comprehension to understand what happened. You are operating like a blindfolded child trying to strike a pinata hoping some candy will fall out. You don't even read what you quote and don't seem to realize the stuff you quote undermines what you say.

That might be because...


That's right - when it turns out that one of usagi's biggest critics had actually lost money as a result of the actions by usagi he was complaining about, usagi accused him and everyone else who criticised of a "stock price manipulation scheme" and uses this as a further argument for why they shouldn't have been allowed to accuse him of being a scammer. Furthermore, usagi has said that he's not going to repay EskimoBob in full or even give him his own shares in full because EskimoBob accused him of scamming:


This is a good reason why people who haven't been scammed should be able to make scammer accusations. We saw a similar phenomena with Pirate's scam where he managed to intimidate most of his victims into shutting up by threatening not to repay them if they didn't.

First off, I'll formulate my accusations however I choose - it's not for you to somehow disallow accusations against you that don't fit some format you desire. 

I will however:

1.  Describe what you said and did, either with evidence of the post (if I have it recorded or it hasn't been deleted) or with a pretty clear explanation of where it was prior to deletion so it can be recovered.
2.  Explain why it (the action or statement) was wrong - unless it's so obviously wrong that there's no need.
3.  If something you said was untrue then explain why you MUST have known it was untrue (getting something wrong accidentally  is absolutely NOT scamming).
4.  Explain some how group of people lost out (or could have lost out) as a result of what you did

I will NOT propose a remedy.  A remedy is irrelevant to whether or not a scam occurred - which is all I'm attempting to demonstrate.  Remedy should be determined AFTER there's been a decision that there was a wrong that needs to be righted.  Similarly I won't attempt to calculate the value of damages - that only determines the SCALE of a scam, not whether or not there is/was one.

Back to doing my report - nearly had it done then found I'd typoed the exchange-rate on which it was all based when doing final double-checks before publishing.

You fell for the oldest trick in the book.

One of the main moves in market mainpulation is to buy from yourself - making it look like demand/trade volume.

All he likely did there was buy back shares from a second account of his.  He got hundreds (or whatever) of BTC from you in return for just paying a trade fee on moving shares from a puppet account back to the issuing account.  Take a look at the really obvious ponzis pn BTC exchanges - watch how they seem to sell a chunk of shares early then post about sales being fast and they're nearly sold out (followed by them suddenly finding capacity to sell more).  Here's a clue - those sales aren't real: they're selling to themselves to make it look like there's demand.  Market-manipulators/scammers do it all the time - establishing volume at a price-point to get naive inestors to believe that an artifical range is 'real'.  Simiarly when he stopped selling shares to let the price recover - it's a safe bet that he was actually still selling, just selling pre-transferred shares from a 2nd account so shares outstanding didn't increase.

And ponzis routinely place Asks below IPO price - they don't actually NEED a fixed amount per share so can sell at any price they want.  Making it look like there's some shares for sale cheap is great for them if it'll get them a few extra sales to bargain-hunters.  So an order book loaded with his orders is fine.  Go look at MOB on LTC-GLOBAL (an obvious scam or disaster that somehow got 5 votes despite no thread, no info on issuer, lots of missing info in contract no evidence of any past activity lending and a claimed board with no identities).  IPO price is 1.0.  See the 400 for sale at 0.95?  Guess who that is (hint: there's less than 400 shares outstanding so you don't even have to guess).  If those were outstanding (rather than unissued - i.e. he had the sense to transfer them to a 2nd account and sell from that) and he bought them back would that convince you he was genuine?

Sorry that you saw something that didn't prove ANYTHING about whether obsi was a scammer or not (if legitimate he was buying back, if a scammer he was probably buying from himself or doing it as a loss-leader - so the action isn't evidence in either direction) and fell for it.

If you wanted to establish he wasn't scamming then the responsible thing to do would be to insist he prove the funds raised are being used in a business generating the profits he claimed.  Anyhting less than that (when you have suspicions) and you aren't trying to find out whether it's a scam or not - you're just trying to find an excuse to ignore the suspicion it's a scam through greed for the promised return.  Which is why all these scams work - people's greed over-rides their common-sense and they look for reasons to invest when, sensibly, they should be looking for reasons NOT to invest and only investing if there aren't any.

There's a really simple rule to follow which will let you avoid nearly all ponzis/blatangt scams and won't make you miss many (if any) real opportunities.  If they won't reveal what they do OR won't prove that they do what they claim to do then don't invest.  It really IS that simple.  Go look for examples of securities where what was being done wasn't revealed (or it WAS revealed but no rpoof given to show it was happening) and investors got their capital back - don't expect to find many (other than loss-leading small loans to set up a bigger one to run with).

Then in principle you do not agree with the evidence used to inform the contention I was misleading investors and misrepresenting the NAV. Thank you.


I believe you are referring to COGNITIVE and ABM. ABM was selling and trading, albeit illiquidly, at ~0.45 IIRC. Sometimes it would dip down to ~0.15. After talking with PsychoticBoy and analyzing the company and the price history, I believed it was worth at least 0.35. So I marked it.

I was also right about COGNITIVE. back when it was ~0.40? or so? I predicted it would go to 0.60 or 0.65. I was right.

Yes I did make some mistakes as initially I was doing everything by hand. But I corrected every mistake which was pointed out to me.


You did not know. And there are things I know which you are not aware of. For example, I saw Obsi buy back thousands of OBSI.HRPT shares on the market to raise the price. That's when I bought in. I had discussions with Obsi about this. maybe I was his mark -- I don't know. I acted on the information I had at the time. Just because you were essentially a non-participant does not mean I wasn't. I had reasonable grounds to believe it was not a scam.


I didn't do that. All of the equipment purchases were in mid-late september at around $11-$12/BTC.


I agree.


I'm not always right. But in this case I have grounds to do what I did. I'm sorry if you don't understand all the inputs that went into my decision making, and I'm sorry if I made mistakes. But I did not defraud, scam, or lie. That is very important in judging whether or not I am a scammer -- I did not create a victim and there are no damages. If there are victims and damages you need to clearly state them. Example:

I, as an investor in BMF, was a victim of usagi's misrepresentation BECAUSE I bought into his company BECAUSE he told me that the stock was worth 1 bitcoin when the truth is, that as soon as he had bought any share whatsoever it should be valued at the bid price. Therefore usagi scammed me out of the bid-ask spread on his investments.

This is just an example -- but it's important to contain the information in the style above: 1. who is the victim, 2. what are the damages, 3. what did usagi do wrong which created the victim and the damages, which proposes the remedy (repayment, in this case).

In the above hypothetical case I could also make a proper response; You are not a victim BECAUSE the contract clearly stated I would provide value through analysis, and I did so by using fair value accounting which '...takes into account objective factors such as acquisition cost'. ... and such information was also provided in weekly shareholder letters and on our website.

See? the three guidelines in the OP are a very simple way to fairly deal with any scammer accusation case.

FWIW I actually agree that for assets like yours, valuing at liquidation price is a bad idea - a terrible idea if you do so based on volume not just highest bid due to low liquidity.  Where it was less clear was when you started valuing things a mile above Ask price because you had some belief that they'd be worth a load more in future.  If something trades in the range 0.9 to 1.0 then value should usually be somewhere in the 0.9-1.0 region (if you can buy them at 1.0 - and noone, including you, is snapping them up, then it's hard to see how they can be worth more than that).  An example of where it got really delusional was continuing to value OBSI.HRPT at IPO price (0.01) even when everyone (apart, apparently, from  you) knew he'd scammed and it was trading in a range a LOT lower.  And valuing hardware at the price you paid for it in BTC even when the exchange-rate had doubled and its BTC value was now half that.  If you take on exchange-rate risks, then the outcome of those risks has to be included in valuations - leaving things at what you paid for them (when beyond ANY doubt they're worth a lot less) just because you don't want to report a loss is NOT good practice.

Not actually sure it's scamming though - I just put it down to a combination of incompetence and a belief you were always right that meant even when someone pointed out a glaring mistake you just assumed you were right without even spending 10 seconds checking.

Anyway, got to do weekly report for my own fund - after that I'll see if I have time to type up details of my first allegation (there's only a handful in total that I'll bother with) and send it to BCB.

Getting back on topic I will use what BCB said as a case study of why remedy is so important.

BCB has said that I admitted to incorrectly valuing my fund and that "it does not look good for usagi" after I had explained to him what we were using principles like fair value accounting and that it was written into our contract to do so. Okay -- then since he has stated what I did was incorrect, he now needs to propose what I should have done -- i.e. what the correct way to value the fund would have been.

The problem here is that it will invariably turn out to be a form of fair value accounting, which "...takes into account such objective factors as...acquisition/production/distribution costs, replacement costs, or costs of close substitutes". It also takes into account subjective factors such as "risk characteristics, cost of and return on capital, individually perceived utility" (i.e. dividends, perceived value, and so on). [http://en.wikipedia.org/wiki/Fair_value]

It is well known that I performed interviews and did real analysis work on mining companies. I interviewed and published interviews with GigaVPS and garr of Cognitive. I have unpublished interviews with Juan of BTC-MINING and friedcat of ASICMINER. It is obvious I did analysis, it was written into the contract I would do analysis. Why is it now an accusation against me that I represented the value of my companies using fair value accounting, taking into account acquisition costs (what we paid, i.e. IPO price) or taking into account subjective factors" or "perceived value"?

I was in a much stronger position to evaluate such things than the average investor due to the work I did on BMF. It is not right that I am now being accused of misrepresenting the value of my funds for that. I am very upset people are saying that about me especially because I advertised what I was doing so widely. Therefore in this case there can be no victim because no one was misled as to the nature of what I was doing. If someone made an assumption and did not read the contract and got stung, it's their own fault. It doesn't mean I am a scammer, it means they should have hired a financial advisor.

Additional information about valuing and fair value accounting:
   The FASB describes Level 3 inputs as “unobservable.” If inputs from levels 1 and 2 are not available, FASB acknowledges that fair value measures of many assets and liabilities are less precise. Within this level, fair value is also estimated using a valuation technique. However, significant assumptions or inputs used in the valuation technique are based upon inputs that are not observable in the market and, therefore, necessitates the use of internal information. This category allows “for situations in which there is little, if any, market activity for the asset or liability at the measurement date.” FASB explains that “observable inputs” are gathered from sources other than the reporting company and that they are expected to reflect assumptions made by market participants.In contrast, “unobservable inputs” are not based on independent sources but on “the reporting entity’s own assumptions about the assumptions market participants would use.” The entity may only rely on internal information if the cost and effort to obtain external information is too high. In addition, financial instruments must have an input that is observable over the entire term of the instrument. While internal inputs are used, the objective remains the same: estimate fair value using assumptions a third party would consider in estimating fair value. Also known as mark to management. Despite being “assumptions about assumptions,” Level 3 inputs can provide useful information about fair values (and thus future cash flows) when they are generated legitimately and with best efforts, without any attempt to bias users’ decisions.

Many times, when an issue did not trade for 5 days, the formula would pull zero values from GLBSE, so I had no choice but to step in and enter a value manually. I would consult a file I kept on each company discussing everything from PPS payout % to mHash a share, charts I had created personally, comparisons by volume, etc -- interviews I had done -- electricity costs when known -- and so forth, and I looked at the value of other similar companies.. and then I invented a value. Yes, it was based on far more information than anyone else had but me, but I did invent it. Because I was supposed to.


I'll allow my own case to be used as a case study. You can argue the point if you want or not. But if you approach it as vampire has done, and try to hijack the thread then yes it does ruin it for everyone.

This thread was supposed to be about the criteria for scammer accusations, not yet another pointless "is usagi a scammer" trainwreck.  Right now it's just "same shit, different day" and to be perfectly honest you might as well close it because any pretence that it's about general principals and not all about usagi can no longer be maintained.

Can you state whether or not you support the contention that I should have valued the portfolio at liquidation prices?

The contract stated that I would provide added value through analysis.

The spreadsheet stated that all values were estimates and listed, in plaintext, the exact formula used to value.

In the practice of fair market value, you are not supposed to value securities at liquidation prices.

Therefore it is wrong to claim that is what I should have done. QED.