Friday, April 4, 2014

Indiegogo is safe haven for fraudulent crowdfunding campaigns

Looks like Indiegogo is on the fast track to lose any (if all) credibility it might still have, thanks to a new fraudulent campaign that is raising all the red flags... And instead of doing something about it, Indiegogo is actually dealing with it in the worst possible way!

There are a lot of people that already consider Indiegogo to be the place for crowdfunding projects that are not accepted in Kickstarter. My own experience with it as not been very positive. I've backed up over a dozen projects, including one that is yet to deliver the promised goods one year(!) after the due date, and one that was a simple repackaging of an existing "chinese" product... at a higher price, of course.

In both cases, Indiegogo response was/is "we have nothing to do with it".

Now, there's a new project that has raised nearly a million dollars and might become the last nail in Indiegogo's reputation coffin. GoBe claims to be able to monitor your calorie intake by using a simple electronic bracelet on your wrist. Experts in the area say it's impossible to do so - but the worse part is that everything surrounding the project is alarming.

The company claims to be based in San Francisco but is in fact operated from Moscow. Their american presence is simply a dummy corporation and a PR-office. They also claimed to have shown their product at CES, but weren't even there. Their CEO Artem Shipitsyn’s Indiegogo biography isn't the same as the one in his LinkedIn page; and none of his team is traceable to anything but this one Indiegogo campaign.

So, the issue is: Indigogo claims to put all campaigns through a fraud review that "allows them to catch any and all cases of fraud". And when confronted with all this, what did they do?

Yes... what they did was remove that claim and reference to their fraud review process!

Can't really believe they would have done this, but it goes in line with my previous experiences with them. Looks like they're simply interested in receiving their cut of the funding, whatever it may be, whether fraudulent or not.

Next time you're considering backing an Indigeogo campaign... it's something you might be aware of.

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