First of all, have you installed and enabled the System - Akeeba GeoIP provider plugin.. This plugin includes the MaxMind GeoIP library Davide talked you about previously. If it's missing there is no way to figure out which country an IP belongs to, therefore it CANNOT be blocked by the GeoIP blocking.
Also, have you updated the database? The plugin is not updated with the latest MaxMind database. If the plugin is installed and active Admin Tools will remind you to update it and do it for you if you click the GeoIP database update button in the control panel.
Moreover, do keep in mind that the MaxMind web site has a newer and more complete version of the GeoIP database than the free of charge version Admin Tools can download and use. Sure enough, if you do pay MaxMind an arm and a leg you can get the more advanced, for-a-fee version of their database and use it with Admin Tools but it does sound like an overkill.
As Davide already told you the GeoIP feature is not an exact science. At best, it has 95% accuracy at the country level. This means that 1 out of every 20 requests will have the wrong country detected. For some countries (notably Russia and China) this rate may be far worse. It all comes down to what MaxMind decides to make available for free.
Finally please note that GeoIP is an incorrect solution. A real attacker can overcome it be means of a botnet, proxy or many other ways. The only people it manages to effectively block are a. legitimate users and b. script kiddies who didn't have a chance to hack you thanks to the other protections (like CSRFShield).
Nicholas K. Dionysopoulos
Lead Developer and Director
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