We Are Bamboo, a tourism company with New Zealand roots, obtained the government’s Covid-19 wage subsidy as it left its customers empty-handed after losing money to risky crypto trades. The Kiwi firm lost $2 million in customer funds as it actively traded prepaid trip funds on various crypto platforms.
Customers were furious to learn that the co-founders of Bamboo suffered losses due to bad trades and fraudulent platforms.
SponsoredGovernment Subsidy Infuriates Customers
According to government documents cited by NZ Herald, Bamboo got three payments. The amount totaled $19,629.60, $10,286.40, and $2,636 for up to four employees.
Customer dissatisfaction increased as a result of this disclosure. Additionally, there are accusations about director Colin Salisbury and co-founder Mark Foster-Murray’s extravagant lifestyles.
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According to Liquidators’ findings, Colin Salisbury put more than $2 million of client money in several cryptocurrency platforms. BeInCrypto reported that active trading of these funds over almost two years resulted in a total loss.
Notably, investments in fraudulent platforms that eventually went out of business cost investors over $800,000.
Denial of Refunds After Losing to Risky Crypto Trades
We Are Bamboo reportedly refused client refunds based on the “force majeure” provision. In the event that normal business activities are disrupted, this contractual provision releases the parties from their obligations.
SponsoredAccording to the report, inquiries into We Are Bamboo’s conduct has been opened. The Commerce Commission, the Serious Fraud Office, and the Ministry of Business Innovation and Employment’s integrity and enforcement division are also probing the firm. The integrity and enforcement team is still looking into possible Companies Act 1992 violations.
Insolvency practitioners involved in the liquidation process must report any serious problems discovered during the proceedings.
The customer testimonials in the paper also point out that Bamboo ‘heavily’ targeted older customers. Many single ladies seeking a ‘safe adventure’ reserved a significant number of the tours.
One of these customers expressed to the newspaper that discovering Salisbury’s use of their money to “speculate in Bitcoin” without holding it securely in an account was “infuriating.”
The risks connected to crypto trading and stablecoins have drawn the attention of the Reserve Bank of New Zealand (RBNZ).
Read more: What Are Algorithmic Stablecoins?
The RBNZ recently highlighted the major risks alongside opportunities brought on by developments in private money. Without advocating for an immediate framework particular to the asset class, the apex body emphasized an ideal balance between innovation and crypto regulation.
However, the Bamboo issue highlights the need for better corporate oversight when handling customer money.
