The Nano Core team was informed by Francesco “The Bomber” Firano — owner and operator of the BitGrail exchange — of a loss from the BitGrail wallet. Our team promptly contacted law enforcement and we are fully cooperating with law enforcement on this matter.
An option suggested by Firano was to modify the ledger in order to cover his losses — which is not possible, nor is it a direction we would ever pursue.
BitGrail has suspended all activities and issued notices it has become insolvent. Many users around the globe have reported huge losses of Nano XRB.
Speculation points to Bomber knowing of the insolvency for weeks and trying to manipulate Nano devs to ransom.
First Statement Posted:
Important notice
Bitgrail Srl Informs its users that the internal checks revealed unauthorized transactions which led to a 17 million Nano shortfall, an amount forming part of the wallet managed by Bitgrail Srl
Today a charge about those fraudulent activities has been submitted to the competent authorities and now is under police investigation.
We inform you that the other currencies have not been involved.
In order to conduct further verifications, all activities will be temporarily suspended (including withdrawals and deposits). This procedure is indispensable for users security.
We offer our full and sincerest apologies to our customers.
Other announcements will be released shortly.
Thank you for your attention.
Additional statement posted:
Official Statement Regarding BitGrail Insolvency
On February 8th, 2018, the Nano Core team was informed by Francesco “The Bomber” Firano — owner and operator of the BitGrail exchange — of a loss from the BitGrail wallet. Our team promptly contacted law enforcement and we are fully cooperating with law enforcement on this matter.
From our own preliminary investigation, no double spending was detected on the ledger and we have no reason to believe the loss was due to an issue in the Nano protocol. The problems appear to be related to BitGrail’s software.
We had no knowledge of BitGrail’s insolvency prior to February 8th.
In our conversation yesterday (which you can find attached here, this link has been edited to redact a private email.), Firano informed us of missing funds from BitGrail’s wallet. An option suggested by Firano was to modify the ledger in order to cover his losses — which is not possible, nor is it a direction we would ever pursue.
BitGrail is an independent business and Nano is not responsible for the way Firano or BitGrail conduct their business. We have no visibility into the BitGrail organization, nor do we have control over how they operate.
We now have sufficient reason to believe that Firano has been misleading the Nano Core Team and the community regarding the solvency of the BitGrail exchange for a significant period of time.
We will not be responding to individual posts or accusations by Firano regarding this situation. We are preparing all information we have on the matter such as blockchain entries, screenshots, and chat logs and presenting them to law enforcement.
Please refer to our Twitter account @nanocurrency for future links to official statements.
Thank you,
The Nano Core Team
Nano Transaction Chain Leads to Additional Speculation and Questions
I don’t know. I have been looking into this and it just doesn’t add up.
the transactions should have taken place well before Jan 18 2018, due to where they are in Bitgrail 1’s wallet chain.
The last transaction on their chain that we can see is Dec112017 https://raiblocks.net/account/index.php?acc=xrb_39ymww61tksoddjh1e43mprw5r8uu1318it9z3agm7e6f96kg4ndqg9tuds4
The account in question https://raiblocks.net/account/index.php?acc=xrb_1fioob7u6ia76rfo1medtrwwdobey1ua8qe7z55qyjimir5b9d95hkdabbjn was only opened on Jan 14, 2018https://raiblocks.net/block/index.php?h=790129AAB2C823EC54BE5EB4314A9E6BB63B53AA0997483F6534642DF002DB79
How could those transactions possibly be earlier in the chain if the account chain wasn’t even started till Mid Jan. I also noticed 610 0.0 XRB transactions that were seemingly spammed to bitgrails address. Those spam transactions were sent on Wed Jan 17th. from https://raiblocks.net/account/index.php?acc=xrb_191zng5defpoof1ke9ekfei778d89igkrb3rk1f8edqukei4hhd6amc5qw4u
Reported by /u/dmanasco
Transcript Conversation between Bomber and Zack Shapiro
Transcript Zack Shapiro The Bomber Bitgrail Nano
Colin/BG chat 4 members, 1 online
Thursday, February 8, 2018
Zack Shapiro created the group «Colin/BG chat» The Bomber invited davvo
Zack Shapiro
ZS
Colin, when you have a moment, Francesco needs a statement
on what you told me last right re: time stamps on the explorer being nearly 100% accurate minus connection latency
The Bomber
Zack Shapiro Wed
8:09:49 AM
9:27:36 AM
ZS
Hey B, I just talked to Colin. He said that time stamps
on the explorer are accurate within a few seconds
There’s a latency due to the internet connection but those time stamps are essentially 100% accurate
The Bomber
@Zackshapiro @clemahieu it’s urgent
Zack Shapiro
ZS
What are your questions or concerns when Colin gets on? Or do
you just need him to type it?
The Bomber
We are investigating on a problem but we need Colin
@Zackshapiro search Colin urgently please
Zack Shapiro
ZS
I am
Can any of our other devs help?
The Bomber
if you can fork the chain, yes zack
Colin LeMahieu
CL
HEy.
The Bomber
Hi Colin
10:44:37 AM
10:56:48 AM
10:58:12 AM
10:59:36 AM
11:00:14 AM
11:00:51 AM
11:01:17 AM
11:07:59 AM
11:08:07 AM
Colin LeMahieu
CL
How’s it all going?
The Bomber
We founds a massive lost in our wallet
and we need to understand what appening
The Bomber
Hey B, I just talked to Colin. He said that time stamps on th… First, about this ^
the date is correct? are you sure? Guys we havent so many time
I need to report this lost to police asap, i need to understand some things before
Colin LeMahieu
CL
Ok, What type of info do you need from me?
The Bomber The Bomber
Hey B, I just talked to Colin. He said that time stamps on th…
11:08:21 AM
11:08:31 AM
11:08:38 AM
11:08:54 AM
11:09:03 AM
11:11:36 AM
11:11:53 AM
11:12:03 AM
11:12:10 AM
^
Colin LeMahieu
CL
The time stamps on the site are when the transactios arrived to
that node so they’re within a couple seconds of when they were created.
The Bomber Colin LeMahieu
The time stamps on the site are when the transactios arrive… Can there be exceptions?
transactions with incorrect date of weeks/months?
Colin LeMahieu
CL
Well it’s similar to a “last accessed” timestamp. It’s just stored
in the database, it should be fairly accurate unless it was modified somehow.
The Bomber Colin LeMahieu
Well it’s similar to a “last accessed” timestamp. It’s just stor… check this
11:12:37 AM
11:13:08 AM
11:13:26 AM
11:15:25 AM
11:15:38 AM
first block F9F8F3
Date Fri, 19 Jan 2018 18:57:00 +0000
all the next blocks are before that
someone with access to your db had modified this info? (dont change dates in any way now)
Colin LeMahieu
CL
As far as I know we’ve never changed any of it, it should be
accurate.
The Bomber Colin LeMahieu
As far as I know we’ve never changed any of it, it should be … have you checked the txs of that address?
Colin LeMahieu
CL
Checked them for what?
The Bomber
the first one is the last one if you see the date
Colin LeMahieu
CL
Yea the top one is most recent.
The Bomber
First -> https://raiblocks.net/block/index.php? h=F9F8F3273C7D40858784B1756EFF1ADE4E26C4B28DBF038
Date Fri, 19 Jan 2018 18:57:00 +0000
Colin LeMahieu
Yea the top one is most recent. see the last in the bottom
Colin LeMahieu
CL
Hmm yea that’s weird. It must not have been recorded right or
11:15:45 AM
11:15:49 AM
11:15:54 AM
11:16:12 AM
11:16:47 AM
11:17:43 AM
11:17:47 AM
11:18:18 AM
11:18:32 AM
11:18:32 AM
11:18:43 AM
11:18:46 AM
11:18:52 AM
11:19:48 AM
The Bomber
This is not a transaction authorized by bitgrail and there are so many all with the same date talking about million of xrb
millions*
almost all tx from BitGrail representative 1 got date = 19 January
https://raiblocks.net/block/index.php? h=7547EDDDB87D6D47975B6EA98A41BEB6C7DE31C952C0BF
https://raiblocks.net/block/index.php? h=DA8A14DA791F26AB923ED69FE7B9AF7838A3AA529C768C
All transactions that are stolen have the wrong date.
Colin LeMahieu
CL
If the node was down and synced back at that time there could
be a lot of transactions all at once.
When your system makes trades, do you keep a date of when it operates?
The Bomber Colin LeMahieu
When your system makes trades, do you keep a date of whe… trades, withdraws, deposits yes
but some of txs shown are not withdraws from us we haven’t recorded in our db
we can try to calculate the date but is very difficlt if explorer is incorrect
11:20:03 AM
11:20:21 AM
11:20:30 AM
11:20:34 AM
11:21:06 AM
11:21:28 AM
11:21:33 AM
11:21:44 AM
11:22:40 AM
11:22:48 AM
11:23:12 AM
11:23:31 AM
11:23:53 AM
11:24:03 AM
11:24:30 AM
this is why I asked zack if it was accurate
edited 11:24:46 AM
Colin LeMahieu
CL
I see. Well it can’t be 100% correct because older transactions
are on the bottom and the date is later than the transactions above it.
That’s just a local date to the explorer machine though, it’s not a guaruntee.
The Bomber
we have suffered a stolen and did not know when this was
How do you recommend behaving as the stole only affects raiblocks?
Colin LeMahieu
CL
It seems like if you have a record of withdrawls or deposits
before/after the transactions with bad timestamps, you could figure out the date.
The Bomber
We certainly can not rely on the explorer as was said
Colin LeMahieu
CL
For instance if you have a record of a deposit for hash AAAA,
you see unknown transaction BBBB, and you have a record for a deposity CCCC, you can know the date of BBBB is between those two.
The Bomber Colin LeMahieu
For instance if you have a record of a deposit for hash AAA… if not, we havent a date
So we know that there can be no certainty of the date on raiblocks
And this is ok
Now, sure this, what can we do to solve the problem?
Zack Shapiro
ZS
how much have you allegedly lost exactly?
The Bomber Zack Shapiro
how much have you allegedly lost exactly?
Seems 15 MLN
11:25:32 AM
11:25:43 AM
11:26:29 AM
11:27:21 AM
11:27:26 AM
11:28:19 AM
11:28:57 AM
11:29:22 AM
11:29:48 AM
11:29:57 AM
11:30:23 AM
11:30:37 AM
11:30:52 AM
XRB or USD
The Bomber
XRB
Zack Shapiro
ZS
didnt you only have 6 in your wallet?
The Bomber Zack Shapiro
didnt you only have 6 in your wallet? we have 4 in our wallet right now
Zack Shapiro
ZS
thx
if someone stole 15M, it would be on the chain somewhere…
The Bomber Zack Shapiro
if someone stole 15M, it would be on the chain somewhere… if we get all addresses you can block in some way?
Zack Shapiro
ZS
how are you determining if a transaction was “stolen”
The Bomber Zack Shapiro
how are you determining if a transaction was “stolen” is not in our database withdrawals list
maybe
but i cant be sure
Zack Shapiro
11:31:06 AM
11:31:21 AM
11:31:41 AM
11:31:54 AM
11:32:00 AM
11:32:01 AM
11:32:08 AM
11:32:29 AM
11:32:54 AM
11:33:14 AM
11:33:18 AM
11:33:22 AM
The Bomber
invalid blocks get rebrodcasted after many days
Zack Shapiro
what if it’s a bug in your code where you just didnt record it no we have the balance of all users
user with this address -> https://raiblocks.net/account/index.php? acc=xrb_1fioob7u6ia76rfo1medtrwwdobey1ua8qe7z55qyjimir 5b9d95hkdabbjn (https://raiblocks.net/account/index.php? acc=xrb_1fioob7u6ia76rfo1medtrwwdobey1ua8qe7z55qyjimir 5b9d95hkdabbjn)
have got – XX Millions XRB we got his email
we got his addresses lists
anyway i’ve closed all XRB markets and XRB deposits / withdraws right now
Zack Shapiro
ZS
do you have transactions coming from your wallet(s) to any of
his addresses
The Bomber Zack Shapiro
do you have transactions coming from your wallet(s) to any … yes
Zack Shapiro
ZS
ah i see them
i scrolled down
Colin LeMahieu
CL
You have email, IP?
The Bomber The Bomber
user with this address -> https://raiblocks.net/account/in… this is one of the address who stole the xrb
Colin LeMahieu
You have email, IP?
11:33:38 AM
11:33:54 AM
11:34:12 AM
11:34:20 AM
11:34:24 AM
11:34:33 AM
11:35:44 AM
11:35:56 AM
11:36:05 AM
11:36:08 AM
11:36:10 AM
11:36:29 AM
11:36:29 AM
11:36:40 AM
email, is a @gmail
we don’t store the real IP, we have cloudflare
email is
Colin LeMahieu
CL
Hmm, didn’t store the IP that ‘s in the proxy header?
Zack Shapiro
ZS
@TheBo mber how much do you owe people, how much do you
have
The Bomber Zack Shapiro
@TheBomber how much do you owe people, how much do …
Users: 19069089.34979714
The Bomber
https:/ / raiblocks.net/ account/ index.php?acc= xrb_3 9ymww… have: A
we are going to report it to police in next minutes we can’t wait ad we need to be 100% trasparent on it
Zack Shapiro
ZS
so you owe 19M and you have – 6M?
The Bomber
Zack Shapiro
so you owe 19M and you have – 6M? no
11 :36:50 AM
11:37:18 AM
11:38:20 AM
11:41:20 AM
11:43:13 AM
11:43: 34 AM
11:44:04 AM
11:44:19 AM
11:44:48 AM
11 :44 :58 AM
we got 4MLN 11:45:02 AM
not 6 11:45:04 AM
3,999,000.000000 XRB 11 :45 : 14 AM
https : / / raiblocks.net / account / index.php? 11 :45: 17 AM
acc= xrb_39ymww6l tksoddjh le43mprw5r8uu1318it9 z3agm7e 6f 96kg4ndqg9tud s4 (htt ps:/ / raiblock s.net / account/ index.php? acc= xrb_39ymww61tksoddjh l e43mprw5r8uu 1318it9z 3agm7e 6f96kg4ndqg9tuds4)
Colin LeMahieu
CL
Your other account has 2m more it seems?
The Bomber
11:45:28 AM
Your other account has 2m more it seems?
2k
not 2kk 2,008.479113 XRB
Colin LeMahieu
CL
Ahh
The Bomber
Zack Shapiro
ZS
so if someone was stealing 10K at a time from BG rep 1, were
you moving funds from rep 2 into it? and that’s why rep 2 is empty
The Bomber
the rep 2 is the hot address
bitgrail send from 2 and receive from 2 the 1 is our cold address
when 2 is empty we moving funds from 1 to 2
Zack Shapiro
ZS
got it
The Bomber
anyway
^ this is one of the address who stolen
Zack Shapiro
ZS
when did you first find out about the hacker
alleged hacker
11:45:39 AM
11:45:49 AM
11:45:51 AM
11:45:52 AM
11:46:08 AM
11:46:14 AM
11:46:40 AM
11:46:51 AM
11:46:56 AM
11:47:08 AM
11:47:43 AM
11:47:49 AM
11:47:50 AM
11:47:59 AM
11:48:18 AM
11:48:20 AM
Zack Shapiro
when did you first find out about the hacker this morning
8 hours ago
Zack Shapiro
ZS
how? what triggered it
The Bomber
we are invetigationg on the f****g date
Zack Shapiro
how? what triggered it
i’m going to move funds from 1 to 2 and check the total users balance
The Bomber
i’m going to move funds from 1 to 2 this morning
My lawyer and I are going to the police, when we come back we will give the news of the stolen
Zack Shapiro
ZS
We increased the number of transactions on the page so you
can see further back
The Bomber
Thnaks
Zack Shapiro
ZS
So you have 4.2, owe 15?
The Bomber
4.002.000
Zack Shapiro
ZS
And how much was “hacked?”
The Bomber Zack Shapiro
And how much was “hacked?” 15 mln
users balances are 19069089.34979714
11:48:29 AM
11:48:39 AM
11:48:41 AM
11:48:54 AM
11:49:02 AM
11:49:15 AM
11:52:17 AM
11:52:53 AM
11:53:14 AM
11:53:55 AM
11:54:22 AM
11:54:43 AM
11:55:03 AM
11:55:14 AM
Zack Shapiro
ZS
And you only have 4,002,000 of that correct
The Bomber
yes zack
Zack Shapiro
ZS
Okay got it
The Bomber
can the fork be a solution?
Zack Shapiro
ZS
No
It looks like it’s been going on for months from the chain
The Bomber
i mean the burned coin
if you get bitgrail exchange you can refund with burned coin and give users their funds
without our intervention
Zack Shapiro
ZS
Why did you just close trading if you “discovered” this 8 hours
ago
The Bomber Zack Shapiro
Why did you just close trading if you “discovered” this 8 ho… We spent time trying to understand what happened
the date on the explorer did not help zaCK
Zack Shapiro
ZS
You didn’t notice anything at all was wrong until 8 hours ago?
The Bomber Zack Shapiro
You didn’t notice anything at all was wrong until 8 hours ago? no Zack, iin case i had suspended the trade before
Zack Shapiro
ZS
I don’t understand?
11:55:39 AM
11:55:46 AM
11:55:50 AM
11:56:28 AM
11:56:46 AM
11:56:56 AM
11:57:03 AM
11:57:21 AM
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11:57:36 AM
11:58:17 AM
11:58:33 AM
11:59:48 AM
12:00:07 PM
12:00:19 PM
The Bomber
Zack Shapiro
I don’t understand?
we spotted the problem this morning
Zack Shapiro
ZS
If withdrawals have been closed for the last month, how did you
not notice this?
Someone with allegedly withdrawing for weeks according to you via this “hack”
The Bomber Zack Shapiro
If withdrawals have been closed for the last month, how did… currently no one know WHEN the hack was done
becase there is NO date in chain
Colin LeMahieu
CL
Do you have dates of wallet actions before / after?
Then you can figure out when it happened.
The Bomber
Colin we only have these transactions with 19 Junuary as dare date*
Colin LeMahieu
CL
Did you say you internally store a date of withdrawl, trade,
deposit?
And the hash?
The Bomber The Bomber
Colin we only have these transactions with 19 Junuary as dare and nobody can explain why
Colin LeMahieu
And the hash? yes
Colin LeMahieu
CL
Ok, what hash/date happened before the bad transactions and
what hash/date happened after?
The Bomber
12:00:44 PM
12:01:27 PM
12:01:43 PM
12:01:51 PM
12:02:02 PM
12:02:17 PM
12:02:24 PM
12:02:44 PM
12:02:46 PM
12:03:03 PM
12:03:11 PM
12:03:13 PM
12:03:24 PM
12:03:41 PM
You probably don’t understand
the stolen wasen’t a withdraw from the site we haven’t store the HAS of the stolen txs
Zack Shapiro
ZS
https://raiblocks.net/block/index.php?
h=790129AAB2C823EC54BE5EB4314A9E6BB63B53AA0997483
Colin LeMahieu
CL
Right, before those transactions, you have valid withdrawls or
deposits right?
Zack Shapiro
ZS
Here’s one from the 14th fwiw
The Bomber Colin LeMahieu
Right, before those transactions, you have valid withdrawls … yes
Colin LeMahieu
CL
Than you have recorded? What’s the date on those?
The Bomber Colin LeMahieu
Right, before those transactions, you have valid withdrawls … how can i know what are the transaction before?
Colin LeMahieu
CL
Then there are transactions after the bad ones that are
recorded? Can you find the in between?
The Bomber
all transaction are before 19 january
Colin LeMahieu
CL
The chain is ordered, even if the dates aren’t correct.
Top is most recent and bottom in least recent in that exact order.
The Bomber
12:04:24 PM
12:04:33 PM
12:04:37 PM
12:04:38 PM
12:04:43 PM
12:04:46 PM
12:04:48 PM
12:05:04 PM
12:05:07 PM
12:05:10 PM
12:05:25 PM
12:05:40 PM
yes
Colin LeMahieu
CL
So if you know the date of transactions below and above as
listed, you know about when the bad transactions happened.
So find a deposit/withdrawl before and after and then you have a range.
The Bomber The Bomber
https://raiblocks.net/account/index.php?acc=xrb_37qbnxb…
12:06:06 PM
12:06:24 PM
12:07:46 PM
^
the second (on the bottom) have 23 october as date so, the transaction is before that date?
Colin LeMahieu
CL
The dates you recorded, not the dates on the site.
Find a hash/date that you recorded for a withdrawl/deposit before and after.
The Bomber
yes colin we can have the last stored info to get the renge anyway, what can we do to avoid the worst?
@clemahieu @Zackshapiro choose together how to communicate the problem
@clemahieu @Zackshapiro are you still here?
Zack Shapiro
ZS
yes
The Bomber
are you thinking about how we can solve this situation?
One solution can be, I give you bitgrail with all wallets and db, and you fork the burned transaction to refund users
the alternative is that this money is probably lost forever
guys, I understand it’s a shock to everyone, but we must try to solve the problem and communicate something to users
If you can take a flight to italy, it will be my pleasure to
12:08:00 PM
12:08:15 PM
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12:29:30 PM
12:30:36 PM
12:32:05 PM
12:32:24 PM
12:39:22 PM
sure i will pay the flight
Colin LeMahieu
CL
For one of the transactions before the problem, can you tell me
a hash and date you have recorded internally for that transaction?
And then a hash/date according to withdrawal or deposit logs you keep for after also.
The Bomber
Colin LeMahieu
CL
Let me know and we can look and maybe find a date.
Your transaction log date/hash for before and after, any transaction, doesn’t need to be the same account.
12:43:42 PM
12:58:36 PM
12:59:10 PM
1:00:39 PM
1:01:06 PM
1:01:31 PM
The Bomber
21 KB
1:04:26 PM
there is a complete list of withdraws of “xrb_1fioob7u6ia76rfo1medtrwwdobey1ua8qe7z55qyjimir5b9d9 5hkdabbjn”
with timestamp (date field)
Colin LeMahieu
CL
Your time stamps or from the explorer site?
The Bomber
our timestamp not from explorer
However it would be important for all us to collaborate in this situation
We need to understand how to announce the problem
The Bomber
Guys, are you going to cooperate or not?
Zack Shapiro
ZS
we’re having a team conversation
1:04:49 PM
1:04:55 PM
1:05:47 PM
1:06:14 PM
1:06:17 PM
1:12:07 PM
1:12:21 PM
1:35:58 PM
1:36:29 PM
The Bomber
If I have to go on my way, tell me ok
I repeat, if we can work together, better
The Bomber Zack Shapiro
we’re having a team conversation Guys ping me when you’re done
Zack Shapiro
ZS
let us think about it
The Bomber Zack Shapiro
let us think about it One thing zack
We must report it to the police To avoid negligence
Jere are 9:38 p.m. So we will going to police tomorrow on 9.30a.m.
Zack Shapiro
ZS
ok
The Bomber
If we can find a solution will be better to find it before
We need to report to the police the solution too to avoid website shutdown by police
I do not know if I have explained the thing
Zack Shapiro
ZS
explained what thing
The Bomber Zack Shapiro
explained what thing
When i will come to police to report the stole, probably they confiscate the server to be able to investigate
I think
So, if you are able to get a solution for the stolen, better to
1:36:42 PM
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2:43:13 PM
2:43:20 PM
If you dont understand, tell me i will try to repeat better Google translate dosent help
Zack Shapiro
ZS
ok. speak in the morning
The Bomber Zack Shapiro
ok. speak in the morning
Is there any possibility to fork the chain and get xrb from burned address?
Seems the only solution for me right now
The Bomber
@Zackshapiro about users, do you think we should say it now? I do not know how much else we could wait
Zack Shapiro
ZS
Can we talk about this tomorrow?
The Bomber Zack Shapiro
Can we talk about this tomorrow?
Yes, tomorrow mean in 10 hours here
10.43 p.m. Here
Zack Shapiro
ZS
ok speak then
The Bomber
The Bomber
@Zackshapiro can i move funds from cold to hot? stolen address seems the cold one
Friday, February 9, 2018
The Bomber
Hi guys
have you decided something?
Zack Shapiro
2:44:51 PM
2:45:00 PM
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1:00:46 AM
1:01:14 AM
ZS
The Bomber
ok, we have to do it
So, no solution from your part?
@Zackshapiro @clemahieu We will say what happened.
Due to an xrb bug that caused the node to crash, the attackers forced the system to get double payments for which we have no trace of time due to another bug in xrb official explorer.
We will say that the devs refuse to cooperate despite the proposed solutions.
We are going to report the incident to the police, first and then we will explain what happened
Millions of dollars of your supporters depend on your decision.
I hope you have understood this before making the decision not to cooperate
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