For more than a year, the Federal Trade Commission (FTC) received hundreds of complaints regarding the peer-to-peer decentralized digital currency bitcoin and one business that dealt with the virtual currency. Perhaps this will be the final instance that will initiate the federal government to establish regulations against bitcoins.
According to documents obtained by Ars Technica through a Freedom of Information Act (FOIA) request, nearly 300 complaints were filed with the FTC against Butterfly Labs (BFL), a Kansas-based bitcoin miner manufacturer.
Described as one of the most mysterious bitcoin companies today, the private firm has had to deal with a growing number of accusations of fraud. At the present time, BFL is in the midst of a federal lawsuit – more of them are likely to transpire.
What did the complaints entail? Well, the complaints came from all over the world – Canada, Estonia, Argentina and the United States – and each complaint contained pretty much the same stories: orders were made but they were never fulfilled or refunds were requested and they were denied.
The technology news publication produced a spreadsheet outlining specific details of the 283 complaints, including what consumers had written about their experiences which occurred between Sept. 2012 and Apr. 2014.
Here are a couple of statements made by BFL customers:
“The company offered a product that would ship after 2 months time. The order was placed on 492013. No item was received by 692013. A refund was requested and the request was ignored.”
“This company refuses to refund me or answer my emails or give a firm shipping date. They have had my money for months.”
“Sent money for a product they tell is no more available. Then they used money sent to purchase a different (cheaper) model for the same price without asking my opinion. Not yet delivered, I don’t want it. Asked for a refund but they say its not possible. This company is scaring forum community and must be regulated.”
Bruce Bourne, BFL’s CFO, told the news outlet in a statement that the company works to resolve each problem that a customer has and provides “100 percent customer satisfaction.”
“If there is a problem, we try to resolve it,” Bourne stated. “We have shipped over 50,000 miners to date and continue to ship and deliver these products with a return rate below two percent. Developing and producing hand-designed ASICs and Bitcoin miners takes time to do right, and we will only deliver products after they are tested and reliable. Our return rate bears out our commitment to excellence and to our customers.”
It is believed that BFL is a multi-million-dollar company and last year it was projected the firm generated between $25 and $30 million in revenues.
It remains to be seen if customers can get their money back. The FTC will assess the complaints and conclude if the federal organization can instigate litigation or not. If so, and the FTC is successful, then customers could see their money returned, but it would take quite a bit of time.
In cases like these, the victims usually call for regulations. Soon after the collapse of Mt. Gox, one of the biggest bitcoin exchanges in the world, there were customers calling for the government and the authorities to protect consumers with legislation and rules.
