6 ms·

A thief can't pass good title on stolen goods: If you buy a stolen item, it is not yours, it is still the original owner's. Doesn't matter if it's a bitcoin, a

by gte910h 15y ago

A thief can't pass good title on stolen goods: If you buy a stolen item, it is not yours, it is still the original owner's. Doesn't matter if it's a bitcoin, a car, or a quarter. The sale was not legit, it should not stand. The rest of the rollback is fuzzier, but on this gentlemans coins, a seizure should occur. http://www.lexisnexis.com/community/corpsec/blogs/bus-law-analysis/archive/2011/06/15/rights-in-collateral-and-estoppel-under-u.c.c.-article-9.aspx http://www.lexisnexis.com/community/corpsec/blogs/bus-law-an...

jacques_chester 15y ago
The exception to this rule is a "bona fide purchaser for value without notice". If someone has no reason to believe that property is stolen and buys it, then it's their property now. So sorry. I'm still confused about whether or not bitcoin transactions are traceable. If they have deniability, it might be impossible to prove/disprove that you knew the goods were stolen. Of course, I am neither a lawyer nor a crypto specialist and this isn't legal advice. (In particular, the rules vary depending on whether the property is realty, on whether you have a Torrens system, whether you have fused equity and what your local courts and legislatures have decided).
- vrotaru 15y ago
  Withdrawls from MtGox are traceable. It just a payment to an address which has to be known in order to make that payment. So, unless they (MtGox) have lost that address too..
  - jacques_chester 15y ago
    OK. That suggests that the original owners would be within their rights to demand a return of the coins. (IANAL, TINLA).
- Tichy 15y ago
  Uh, is that really so? So I can steal whatever I want, as long as I can sell it off fast enough? Say I am 99 years old and have only one week left to live. What if I go on a car stealing spree and steal Porsche cars for my extended family. Then I sell it to them for a symbolic 1 cent each, claiming that I have collected them over my lifetime and now want my family to benefit.
  - jacques_chester 15y ago
    You've misread me. You, the thief, are still on the hook for your crime. The buyer, if they really are a bona fide purchaser for value without notice, is not. Your family would probably not meet the test, as this would be the first time they've heard of the Porsches. (IANAL, TINLA)
    - Tichy 15y ago
      Yes, what I mean is that if I was 99, I wouldn't care much about being punished for being a thief. I could therefore make a lot of people happy. If not my family, then maybe I could go Robin Hood, steal from the rich and sell cheaply to the poor. I can't imagine that it works that way. I can believe that as a buyer of stolen good without knowing they were stolen, you won't be punished. But you will still have to return the stuff. I am not a lawyer either, though. If it works as you describe, let's found a guild of 99 year old Robin Hoods...
      - jacques_chester 15y ago
        > If not my family, then maybe I could go Robin Hood, steal from the rich and sell cheaply to the poor. Note "for value". If the price is unrealistically cheap, the courts can point out that the buyer should have been suspicious. > I can't imagine that it works that way. I can believe that as a buyer of stolen good without knowing they were stolen, you won't be punished. But you will still have to return the stuff. You don't have to return it, it's yours now. The point is that the bona fide purchaser is not a criminal and acted in good faith. If, however, there is the slightest whiff of a hint of a suspicion, those bona fides collapse and title reverts to the original owner. It is harder to prove bona fides than you might think. Got a great price? Not for value, test fails. Knew the seller? Not bona fides, test fails. Bought it from someone who has no history of selling those items? Possible notice, test fails. And so on. Look, here's the thing. Lawyers and judges have been working on this system (the common law) for nearly a thousand years. For day-to-day stuff like property, the loopholes are well and truly closed and have been for hundreds of years. That I was an inadequate law student and now am an inadequate explainer does not change the fact that the common law is pretty damn adequate at providing sensible legal protection for almost all imaginable transactions. (IANAL, TINLA)
- wmf 15y ago
  Bitcoin transactions are all public, but on Mt.Gox you can't see who the other side of a trade is.
- eridius 15y ago
  I think it's safe to say that Kevin knew the bitcoins he purchased were not on the up-and-up.
  - tedunangst 15y ago
    He knew the trades were unusual, but there are also other explanations for weird trades than dumping stolen goods.
    - jrs235 15y ago
      Exactly. He may have seen the unusual dumping of bitcoins as a planned crash. Someone who legitimately acquired them with the intention of doing this dumping in order to prove some point. To prove that these the account was hacked and the coins sold illegally, has anyone seen the police reports?
- praptak 15y ago
  "The exception to this rule is a "bona fide purchaser for value without notice". If someone has no reason to believe that property is stolen and buys it, then it's their property now. So sorry." This rule only applies in some law systems. Where I live you need both to perform all the reasonable checks and 3 years time to become the owner of the stolen property. If the original owner shows up before 3 years have passed then you have to get back whatever you have bought. This happens even if you have performed all of the reasonable legitimacy checks. One exception is land registration - entries in the public land register (even those obtained illegally) protect the purchasers from claims by the original owners (this does not apply to bad faith buyers.)
  - jacques_chester 15y ago
    You're right in that it will vary by jurisdiction. I guess I didn't use enough caveats. :D
- gte910h 15y ago
  An exception in some places. In most places in the US, you are not the owner.
juiceandjuice 15y ago
It does matter if it's a bitcoin, a car or a quarter. A bitcoin is completely virtual with no intrinsic value. The legal recourse that would occur in this case is undefined.
- jacques_chester 15y ago
  I think you've confused title with damages. If I own something, I have legal rights enforceable on it, regardless of whether anyone else thinks it's valuable. If I owned the bitcoins -- I suspect common law would have little difficult in identifying these as distinctly ownable -- then I have enforceable rights in them. I can ask the court to order those rights be respected. Property rights in virtual property is a fast-growing area of law, however, so: IANAL, TINLA.
  - juiceandjuice 15y ago
    Ultimately, there's the way things should be and the way things are, and Bitcoin already has a stigma. Sure, it's not illegal right now, but that doesn't mean it's legal either. That's all I'm saying. Imagine the headlines: "Virtual currency used by drug traffickers stolen from users, courts play world's tiniest violin." If a drug dealer steals a kilo from another drug dealer he's not going to take it to the courts. Thinking you will be entitled to some form of legal recourse should something similar happen to you when trading bitcoins is, IMO, foolish at this point.
    - jacques_chester 15y ago
      > If a drug dealer steels a kilo from another drug dealer he's not going to take it to the courts. As you can imagine, courts do not uphold contracts where there is an unlawful objective ("I paid him to beat my boss and he didn't!") and in most jurisdictions you cannot obtain property rights in certain things (in others you can, but asking for enforcement exposes you to criminal prosecution so in practice it doesn't happen). Bitcoin is not a prohibited item and the exchange of bitcoins looks very much like contracts that don't have a unlawful objective. Put another way: courts would probably enforce rights for trades made on Mt Gox, but not on Silk Road. (IANAL, TINLA)
rick888 15y ago
Bitcoins are just bits on a computer and aren't physically taken away like a car or a quarter...so I don't think you can call it "stealing"
- jacques_chester 15y ago
  Property rights are establishable in a lot of things that are abstract with numerous physical representations. You can own commercial licences, shares, bonds, debts, legal rights to this and that and so on and so forth. Property law does not require physical property in order to be applicable. (IANAL, TINLA)
  - rick888 15y ago
    good, I'm glad. I hope when articles pop up about piracy, more people agree that it isn't just bits being transferred.
    - william42 15y ago
      There's still a fundamental difference between stealing bitcoins by inducing a transfer and copying music or video games or etc. The latter is clearly a lesser crime.
- Sapient 15y ago
  The RIAA and MPAA would disagree with you.
  - corin_ 15y ago
    More relevantly, so would anyone who ever had their bank account hacked or debit card cloned...
DannyBee 15y ago
Uh, look at something like "bearer bonds". You are assuming bitcoins are like a negotiable instrument. They aren't, they are much closer to bearer bonds. Whoever holds the wallet owns the bitcoins. There is no other recorded title.
- gte910h 15y ago
  If you steal bearer bonds, then sell them, they will still be returned in most parts of the US if you can prove the theft. This has nothing to do with what a bitcoin wants to be, but what law in the US is with regards to stolen property.

by gte910h 15y ago

jacques_chester 15y ago

The exception to this rule is a "bona fide purchaser for value without notice". If someone has no reason to believe that property is stolen and buys it, then it's their property now. So sorry. I'm still confused about whether or not bitcoin transactions are traceable. If they have deniability, it might be impossible to prove/disprove that you knew the goods were stolen. Of course, I am neither a lawyer nor a crypto specialist and this isn't legal advice. (In particular, the rules vary depending on whether the property is realty, on whether you have a Torrens system, whether you have fused equity and what your local courts and legislatures have decided).

vrotaru 15y ago
Withdrawls from MtGox are traceable. It just a payment to an address which has to be known in order to make that payment. So, unless they (MtGox) have lost that address too..
- jacques_chester 15y ago
  OK. That suggests that the original owners would be within their rights to demand a return of the coins. (IANAL, TINLA).
Tichy 15y ago
Uh, is that really so? So I can steal whatever I want, as long as I can sell it off fast enough? Say I am 99 years old and have only one week left to live. What if I go on a car stealing spree and steal Porsche cars for my extended family. Then I sell it to them for a symbolic 1 cent each, claiming that I have collected them over my lifetime and now want my family to benefit.
- jacques_chester 15y ago
  You've misread me. You, the thief, are still on the hook for your crime. The buyer, if they really are a bona fide purchaser for value without notice, is not. Your family would probably not meet the test, as this would be the first time they've heard of the Porsches. (IANAL, TINLA)
  - Tichy 15y ago
    Yes, what I mean is that if I was 99, I wouldn't care much about being punished for being a thief. I could therefore make a lot of people happy. If not my family, then maybe I could go Robin Hood, steal from the rich and sell cheaply to the poor. I can't imagine that it works that way. I can believe that as a buyer of stolen good without knowing they were stolen, you won't be punished. But you will still have to return the stuff. I am not a lawyer either, though. If it works as you describe, let's found a guild of 99 year old Robin Hoods...
    - jacques_chester 15y ago
      > If not my family, then maybe I could go Robin Hood, steal from the rich and sell cheaply to the poor. Note "for value". If the price is unrealistically cheap, the courts can point out that the buyer should have been suspicious. > I can't imagine that it works that way. I can believe that as a buyer of stolen good without knowing they were stolen, you won't be punished. But you will still have to return the stuff. You don't have to return it, it's yours now. The point is that the bona fide purchaser is not a criminal and acted in good faith. If, however, there is the slightest whiff of a hint of a suspicion, those bona fides collapse and title reverts to the original owner. It is harder to prove bona fides than you might think. Got a great price? Not for value, test fails. Knew the seller? Not bona fides, test fails. Bought it from someone who has no history of selling those items? Possible notice, test fails. And so on. Look, here's the thing. Lawyers and judges have been working on this system (the common law) for nearly a thousand years. For day-to-day stuff like property, the loopholes are well and truly closed and have been for hundreds of years. That I was an inadequate law student and now am an inadequate explainer does not change the fact that the common law is pretty damn adequate at providing sensible legal protection for almost all imaginable transactions. (IANAL, TINLA)
wmf 15y ago
Bitcoin transactions are all public, but on Mt.Gox you can't see who the other side of a trade is.
eridius 15y ago
I think it's safe to say that Kevin knew the bitcoins he purchased were not on the up-and-up.
- tedunangst 15y ago
  He knew the trades were unusual, but there are also other explanations for weird trades than dumping stolen goods.
  - jrs235 15y ago
    Exactly. He may have seen the unusual dumping of bitcoins as a planned crash. Someone who legitimately acquired them with the intention of doing this dumping in order to prove some point. To prove that these the account was hacked and the coins sold illegally, has anyone seen the police reports?
praptak 15y ago
"The exception to this rule is a "bona fide purchaser for value without notice". If someone has no reason to believe that property is stolen and buys it, then it's their property now. So sorry." This rule only applies in some law systems. Where I live you need both to perform all the reasonable checks and 3 years time to become the owner of the stolen property. If the original owner shows up before 3 years have passed then you have to get back whatever you have bought. This happens even if you have performed all of the reasonable legitimacy checks. One exception is land registration - entries in the public land register (even those obtained illegally) protect the purchasers from claims by the original owners (this does not apply to bad faith buyers.)
- jacques_chester 15y ago
  You're right in that it will vary by jurisdiction. I guess I didn't use enough caveats. :D
gte910h 15y ago
An exception in some places. In most places in the US, you are not the owner.

juiceandjuice 15y ago

It does matter if it's a bitcoin, a car or a quarter. A bitcoin is completely virtual with no intrinsic value. The legal recourse that would occur in this case is undefined.

jacques_chester 15y ago
I think you've confused title with damages. If I own something, I have legal rights enforceable on it, regardless of whether anyone else thinks it's valuable. If I owned the bitcoins -- I suspect common law would have little difficult in identifying these as distinctly ownable -- then I have enforceable rights in them. I can ask the court to order those rights be respected. Property rights in virtual property is a fast-growing area of law, however, so: IANAL, TINLA.
- juiceandjuice 15y ago
  Ultimately, there's the way things should be and the way things are, and Bitcoin already has a stigma. Sure, it's not illegal right now, but that doesn't mean it's legal either. That's all I'm saying. Imagine the headlines: "Virtual currency used by drug traffickers stolen from users, courts play world's tiniest violin." If a drug dealer steals a kilo from another drug dealer he's not going to take it to the courts. Thinking you will be entitled to some form of legal recourse should something similar happen to you when trading bitcoins is, IMO, foolish at this point.
  - jacques_chester 15y ago
    > If a drug dealer steels a kilo from another drug dealer he's not going to take it to the courts. As you can imagine, courts do not uphold contracts where there is an unlawful objective ("I paid him to beat my boss and he didn't!") and in most jurisdictions you cannot obtain property rights in certain things (in others you can, but asking for enforcement exposes you to criminal prosecution so in practice it doesn't happen). Bitcoin is not a prohibited item and the exchange of bitcoins looks very much like contracts that don't have a unlawful objective. Put another way: courts would probably enforce rights for trades made on Mt Gox, but not on Silk Road. (IANAL, TINLA)

rick888 15y ago

Bitcoins are just bits on a computer and aren't physically taken away like a car or a quarter...so I don't think you can call it "stealing"

jacques_chester 15y ago
Property rights are establishable in a lot of things that are abstract with numerous physical representations. You can own commercial licences, shares, bonds, debts, legal rights to this and that and so on and so forth. Property law does not require physical property in order to be applicable. (IANAL, TINLA)
- rick888 15y ago
  good, I'm glad. I hope when articles pop up about piracy, more people agree that it isn't just bits being transferred.
  - william42 15y ago
    There's still a fundamental difference between stealing bitcoins by inducing a transfer and copying music or video games or etc. The latter is clearly a lesser crime.
Sapient 15y ago
The RIAA and MPAA would disagree with you.
- corin_ 15y ago
  More relevantly, so would anyone who ever had their bank account hacked or debit card cloned...

DannyBee 15y ago

Uh, look at something like "bearer bonds". You are assuming bitcoins are like a negotiable instrument. They aren't, they are much closer to bearer bonds. Whoever holds the wallet owns the bitcoins. There is no other recorded title.

gte910h 15y ago
If you steal bearer bonds, then sell them, they will still be returned in most parts of the US if you can prove the theft. This has nothing to do with what a bitcoin wants to be, but what law in the US is with regards to stolen property.