New Zealand-based ethical travel company, We Are Bamboo, used customer funds from prepaid trips for active crypto trading across multiple platforms. Local media reported that it led to the company’s bankruptcy and left customers without refunds.
Around $2 million in customer funds from prepaid trips were actively traded over a period of approximately two years.
$2M Customer Funds Lost to Crypto Trading
The liquidators reveal that We Are Bamboo’s director, Colin Salisbury, invested over $2 million. These were customer funds that ended up in various cryptocurrency platforms.
During the period from October 2020 to mid-2022, the active trading of customer funds led to a complete loss. Customers lost around $800,000 due to investments in fraudulent platforms that ultimately ceased operations.
Customers have lodged complaints with the police, with the probe now with the Commerce Commission and Serious Fraud Office.
Learn the different trading strategies and choose the most suitable for your crypto trading needs with our explainer here: Stop Loss vs. Stop Limit: Which Works Best in Crypto Trading?
We Are Bamboo reportedly invoked the “force majeure” clause for denying customer refunds. Force majeure is a contractual clause that excuses parties from fulfilling their obligations in cases of unforeseen and unavoidable events that disrupt normal operations. It protects companies from creditor liabilities.
According to the report, the affected customers were from the United States, Britain, Canada, and Australia.
Responsible Handling of Funds
Loss of customer funds via crypto trading has added insult to injury for affected customers. Several testimonies state that they feel deceived and betrayed. The company’s actions have further damaged the public perception of cryptocurrencies. These customers are now seeking justice from the authorities.
Liquidators have begun investigating the actions of We Are Bamboo management, directors, officers, and advisors. Liquidator BDO will also assess the distribution of available funds to unsecured creditors and explore other avenues for potential recovery.
This incident highlights the need for transparency, accountability, and responsible handling of customer funds. What companies and exchanges did with customer funds became a theme in public discourse after the FTX collapse. Companies need to be particularly careful when it comes to the integration of volatile assets like cryptocurrencies in business operations.
Such incidents also have a detrimental impact on public perception and trust in cryptocurrencies.
As the liquidation continues, affected customers hope for a resolution and fair compensation for their losses. However, the timeline for the settlement remains uncertain.
Meanwhile, New Zealand has been enforcing stricter crypto controls amid increased adoption. The new rules have reportedly impacted transactions and account openings for crypto trading platforms and industry players.
Disclaimer
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
