UPDATE (30th July 16:54 BST): This article has been updated with additional comment from igot users.
Rick Day, igot’s founder told CoinDesk the delays particularly affected fiat withdrawals, attributing them to a number of factors.
“They [the issues] are as not as big as they appear from the outside … one of the biggest issues that we have with delays is banking relationships.”
Strained banking relations
Day said the exchange had received a few incoming fraudulent transactions into one of its bank accounts in Australia.
“The person sending the funds basically used stolen bank accounts to fund igot wallets and withdraw bitcoin and [then] disappeared,” he explained.
This particular igot user, Day added, had a verified account, which raises questions around the company’s verification procedure. Day explained:
“Their account got verified by providing legitimate documents. Problem is, it was not that person’s ID. We’ve seen this many times and enforce video calls for many of our users to prove they are who they say they are. By the time we got to that point with this account, it was too late. The bank had already restricted the account and funds frozen.”
To overcome this issue, Day said, igot will require users making deposits over a certain amount to engage in mandatory video calls in the future.
The founder said progress had been made and he expected account restrictions to be removed by mid-August. “We’re certain that we will be able to resolve all the withdrawal issues in the next one to two weeks. Banks have so far been very cooperative and we’ve assisted them with their investigations.”
In order to prevent these kind of issues from happening again, Day noted his company was looking to procure additional banking partners.
“We’ve established a more solid relationship with other banks internationally … We’ve opened multiple accounts in multiple countries so we do not depend on any one bank and be in this situation again.”
Although, CoinDesk has not seen evidence of these relationships.
In addition to its strained banking relationship, Day claimed igot had also been subjected to a series of “very sophisticated” DDoS attacks in the past weeks.
The attacks, Day said, were not targeting the site itself, but the wallet addresses by sending ‘dust’ transactions.
This, he said, has been mostly contained. “We have started rerouting such transactions, removing such addresses and suspending such accounts. We’ve made some good progress here and are going to resume normal services soon.”
One Reddit user, who goes by the name of fernetbreakfast, voiced his dissatisfaction with the company:
“Excuse after excuse, now 30 days missing $12,000USD. DDOS excuse for last tw weeks – these guys are about go under. Buyer beware.[sic]”
Others took to Twitter to note the inconvenience caused by the ongoing delays:
@iGotcom Very very worst service I have ever seen my life. Small businessman like me can’t afford this type of delay.
— Prafulla Shinde (@microsysimpex) July 24, 2015
Day sympathised with users, but calling igot untrustworthy or feeling that they have been robbed was not, he said, a fair assessment.
“Were withdrawals delayed? Absolutely. At the same time, we were able to make many payments.”
The intention of the business was not to rob people, he said. “Our business model works great. We have some really big potential and are not one bit interested in robbing users.”
One user, who is owed $400, told CoinDesk: “I am not sure it is a scam, however, what is ridiculous is the support shown to every customer who is as nervous as I am about the status of my money.”
The recent events aren’t the first to cause people to criticise igot’s services. In May this year, users also complained of delayed withdrawals. At the time, igot assured its customers the issues were due to a “major upgrade” to its system.
Nevertheless, Day said people should not “write off” his company, stating that it has been running for 18 months and has many satisfied customers.
“We provided great customer service to our customers and will continue to do so,” he concluded.
In the meantime, many igot customers are still awaiting access to their funds. A user who is owed over $15,000 told CoinDesk:
“Rick … constantly promises payment ‘shortly’, but never delivers. I have learnt the painful lesson of never trusting him with my money. He uses convenient but difficult to verify excuses such as bank issues, upgrades and external attacks.”
This article should not be viewed as an endorsement by CoinDesk. Users should do their own research before trusting their funds to any company.
The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.