New Zealand Authority Posts Warning About Bitcoin Exchange IGOT

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The Financial Markets Authority (FMA) of New Zealand has noted it has received complaints from New Zealand based clients of igot, an Australia-based bitcoin exchange, about igot’s failure to repay clients in accordance with their instructions. Igot is not registered or required to be registered to provide financial services in New Zealand.

The warning posted on the FMA’s “Businesses to be wary of” page. The FMA attempts to protect investors from businesses that are or have been registered on the Financial Service Providers Register (FSPR) and are the subject of complaints about misconduct that suggests customers may lose money.

If the FMA receives a complaint about a business or individual registered on the FSPR, it asks for an explanation. The FMA lists businesses to be wary of that have either not responded or have not provided a satisfactory response to a request for information about a complaint.

Igot Claims DDoS Attack

Igot’s blog stated a distributed denial of service (DDoS) attack is causing delays on its platform. The blog noted the attack is designed to “choke” the system, with thousands of bitcoin transactions, as low as 0.000001 BTC, being sent daily to an igot wallet. The blog includes an image to convey the volume of incoming transactions.

The blog stated igot utilizes industry-standard DDoS protection, “but unfortunately in this case it is not effective.”

The igot team has minimized the attack’s severity, but more remains to be done. “We hope to return to a normal service very soon,” the blog noted. “Please keep an eye on our Facebook and Twitter feeds for updates as the situation changes.”

The entire bitcoin network recently suffered a similar spam attack, albeit on a larger scale, the blog noted. An overview can be seen in this blog post by BlockCypher.

Similar Situation Occurred In April

Igot made the same statement about a DDoS attack in April when clients said the exchange was unable to deliver on purchases or provide refunds for months, reported.

Nicholas Giurietto, chief executive of Australian Digital Currency and Commerce Association (ADCCA), said at the time that igot customers have been devastated. The association announced it would publish a code of conduct to stop users from losing money from bitcoin companies that fail, even though igot was not an association member.

Rick Day, the owner of the exchange, told ABC in April that he was struggling to pay customers. He said he was aware customers were affected and unhappy, but he wanted to assure them the exchange had not lost their money.

“We have not run away with anything and we will return the money,” Day said at the time.

Also read: Australian digital currency industry weighs up code of conduct as igot exchange nears collapse

Customers Cited Problems In April

Akram Bekzada invested with igot in 2014 and was trying to withdraw $13,000 worth of bitcoins since last October, according to ABC. He said igot was not being transparent about the issue.

Bekzada said he filed complaints with the Australian Securities and Investment Commission and the Australian Competition and Consumer Commission, both of which said there was nothing they could do.

Zhenya Tsventnenko’s company, Digital CC, was owed $180,000 and has taken court action, according to ABC.

Owen Champion, a software developer, tried for months to withdraw $7,000 worth of bitcoin from igot. After posting online that he was interviewed by ABC, he received half of his money.

Igot launched in Australia in 2013, according to its website. The company noted it has a presence in Europe, Asia and the United Arab Emirates. Igot serves as a bitcoin exchange, a money transfer service, a bill payment service and a bitcoin merchant acceptance service.

Featured image from Shutterstock.

Last modified: July 13, 2020 3:15 AM UTC

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Lester Coleman

Lester Coleman is a media relations consultant for the payments and automated retailing industries.