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Scammers Continue to Wreak Havoc in MMO's

Posted by CmdrTaco on from the but-i-need-my-virtual-gold dept.

eldavojohn writes "We're all well aware of the scams that sometimes happen in online games like Eve Online. But despite this looking primarily like a problem with Eve Online, the MIT Technology Review brings us stories from Second Life and the very real $700,000 (USD) in Linden Dollars that has recently disappeared in what is appearing to be a classic ponzi scheme by a company named Ginko Banking. Unbelievably high interest rates coupled with some shady withdrawal limits leads to classic epic losses to investors. Eve Online was merely virtual currency but Second Life has a real monetary value associated with Linden Dollars & therefore is certain to see more and more scams pop up like this. How can Linden Labs set up a safety net to catch things like this?"

19 of 330 comments (clear)

  1. They shouldn't by Icepick_ · · Score: 5, Insightful

    Let people be stupid.

    1. Re:They shouldn't by PowerEdge · · Score: 5, Insightful

      That'd be nice and all... But in 1st life, people are losing homes for being caught up in schemes, not being "smart" about their purchases, etc. and real action is being taken to punish those who defrauded such "rubes". For some reason or other the Gov't and people in general frown on swindling.

    2. Re:They shouldn't by Jugalator · · Score: 4, Funny

      You have a point there. They should probably make it illegal to be stupid to cover these problems.

      --
      Beware: In C++, your friends can see your privates!
    3. Re:They shouldn't by shawn(at)fsu · · Score: 4, Insightful

      "A fool and his money are soon parted."
      --Thomas Tusser

      --
      500 dollar reward for tip(s) leading to the arrest of the person(s) who stole my sig.
    4. Re:They shouldn't by PowerEdge · · Score: 5, Insightful

      I agree 100%. Though there was definitely predatory lending and people buying on supposed "house payments" not understanding that taxes, and resets would in effect triple payments in a short couple of years. People buying said homes sometimes were expressly ignorant, or thought they could easily get out of the house when they no longer could afford it. Lots of people lost money in the 1990s and early 2000s due to VC and Media hype on xyz.com IPO. Lots of smart people lost a fortune. It happens. Due diligence is always necessary when forking over hard earned, real money. Unfortunately many people are gullible and are sold a pack of lies. Those selling the pack of lies should be prosecuted and punished. Personally, I fault the Government Schools and Parents for creating the environment we have today. People are manufactured stupid now.

    5. Re:They shouldn't by CrankyFool · · Score: 5, Insightful

      Hardly.

      If we treat this as a moral or ethical issue, we can reasonably argue that we should let people learn, the hard way, how to be responsible for their own finances, especially in an environment where the actual exposure is relatively minimal (the person they covered lost $144 in this scam, and she apparently made all that money by doing things she liked doing on Second Life anyway -- we're not talking about not being able to pay rent here).

      But it's not a moral or ethical issue -- it's a commercial issue. If Linden Labs wants to encourage people to treat Lindenbucks as real money -- and clearly, they do because otherwise they wouldn't set up an exchange rate to the real deal -- then they've got to deal with what is essentially a threat to their profitability. If they don't set up a system where it's safe to exchange money for other tangible goods (and stocks or CDs are tangible), then, in fact, people will learn to protect themselves -- by not transacting with their money and essentially putting their virtual dollars under their virtual mattresses. This is not an outcome that is ideal for Linden Labs -- which is why, regardless of ethics, morality, or "think about the children (or stupid people)!", they should do something to create some sort of reliable, authenticated commerce system that allows for these activities -- out of sheer self interest.

    6. Re:They shouldn't by gowen · · Score: 5, Insightful

      Yes. And while we're at it, why not let little old ladies be weak, and let the much stronger muggers take their money.

      I mean, if they deserved that money, they'd be strong enough to still have it, right?

      If the smart should be allowed to scam the stupid, why shouldn't the strong be allowed to steal from the the weak?

      --
      Athletic Scholarships to universities make as much sense as academic scholarships to sports teams.
    7. Re:They shouldn't by Anonymous Coward · · Score: 5, Insightful

      But in 1st life, people are losing homes for being caught up in schemes, not being "smart" about their purchases, etc. and real action is being taken to punish those who defrauded such "rubes". For some reason or other the Gov't and people in general frown on swindling.

      Hahaha. Aside from some cases of fraud, the majority of these cases are people who normally wouldn't qualify for a regular mortgage, and were offered a subprime mortgage at a higher rate, which allowed them to purchase a home. Some of these people bought a lot more than they could afford, and the homeowners are losing their homes as a result (incidentally, the lenders also lose money in foreclosure).

      By comparison, if a bank uses reasonable, impartial criteria (like having a verifiable job, income, down payment & assets) before issuing a mortgage, then civil rights activists would be threatening to sue, saying that the lender is discriminating against minorities.

      Yes, it's very sad that these people lose their homes, but they bought much more than they could afford. Back when I wasn't making very much money during the high-tech bust of 2000, I drove a beat-up Honda Civic. No one would sympathize with me if I had bought a big BMW and couldn't keep up with the payments.

      Live within your means, and read before you sign anything.

    8. Re:They shouldn't by pionzypher · · Score: 4, Interesting

      While I agree that the laws should continue to protect against fraud, there's a limit to what they can do. Example: Recently I saw a special on MSNBC about online fraud. The guy traced online scams from the victims to those in america who were helping the scammers, to the scammer himself in a country bordering nigeria. The scammer posed as some hot latina girl who looked to be in her upper twenties. He convinced this middle aged man to pick up, and re ship packages with his own time and money. This was all done with careful social engineering by playing on his emotions- he thought they were dating and she seemed vulnerable and in need of his help. When the guy was confronted, he was flabbergasted that not only was she not real but he was actively helping to steal from people. Apparently he had sent her many thousands of dollars to help with fake hospital bills on top of the shipping costs for packages.

      The guy hadn't even tried to do a basic reality check. There are a lot of people in the US who would be caught up in a scheme like that if the situation were right. Is he culpable for taking a package shipped to him and shipping it out again on his own dime, trying to help someone? Now we're sort of full circle. Do we nail this guy for what is essentially a crime of being ignorant or trusting? Do we try to educate him? His face just went blank when he learned the truth. He didn't know all this internet stuff. Just that wendy lied about loving him. How could we best prevent him from falling for a similar scam in the future?

      In the end, there has to be some effort to be informed and realistic about online transactions on a personal level. Those that can't be, should in all seriousness avoid online transactions. This is no different that investing. If you're uneducated, you really shouldn't go investing large amounts of money.

      There will always be scams that slip through the cracks. There will always be people who fall for them.

      --
      I'll believe in corporations having personhood when Texas executes one... - advocate_one
    9. Re:They shouldn't by Anonymous Coward · · Score: 5, Interesting
      The guy hadn't even tried to do a basic reality check.

      They rarely do. I live in a relatively poor country, and all the time I see tourists come here and "fall in love" with a local girl. They buy furniture, rent an apartment for her, and when they go back home they keep sending money. In the mean time her real boyfriend has moved into the apartment with her and sleeping in the bed that he bought.

      Once just by chance I happened to be talking to one of these tourist "boyfriends," and told him what was happening. What a mistake. Not only did he not believe me, he actually threatened me for "telling these vicious lies."

      When the illusion is sufficiently compelling the desire to believe trumps rational thought.

  2. Re:It's a game by Chubby_C · · Score: 5, Funny
    It is a game, the game allows it so it should be fair play.

    People have to watch out for this in real life, they should watch out for it in second life

    The scammers are obviously better players

    --
    - My question is: Can Slashdot be Slashdotted? -
  3. Wait, wait, wait... by Serenissima · · Score: 4, Insightful

    So, any anonymous Joe Schmoe can open a Bank in Second Life? And people are surprised when they give money to a stranger and something like this happens? Well shit, maybe I should start playing the game and create my own bank! You know you can trust me because I'm playing the same game you are! That makes us almost like kin!

    --
    Give a man a fire and he'll be warm for a day. But light a man on fire and he'll be warm for the rest of his life.
  4. Re:One really obvious way by nsanders · · Score: 4, Insightful

    Removing the legal exchange won't prevent it. Look at Diablo 2 and the insane rates of SOJs on eBay in the beginning. No matter what, people will scam for money because even if its not worth real money, its still worth something to someone.

  5. ugh.. by Detaer · · Score: 5, Insightful

    How does second life still drum up this much publicity? Its nothing but over hyped marketing and furries looking for some sort of acceptance. If you don't talk about it, second life will disappear.

    1. Re:ugh.. by Kreigaffe · · Score: 5, Insightful

      I was scrolling through looking to see if someone hadn't made this sort of comment.

      If no one had, I was going to.. instead I'll throw my support behind your comment as much as I can with no mod points.

      Second Life is just.. just fucking terrible. I've seen articles about second life in all SORTS of publications, because the writers play.. and the funniest one was in a business mag, geared towards management (i can only assume middle.. blegh). Talked about all sorts of buzzwords, bunch of bullshit, you get to the end of the article and the writer included a shot of his in-game character, how nice.

      With a tiger's head.

      The shit you're forced to read when you're not-working at work and already read the 4-day old newpaper..

      --
      ... still waiting for this free-as-in-beer free beer I keep hearing about. :|
  6. If it is too good to be true... by db32 · · Score: 4, Insightful

    I have a real hard time feeling very sympathetic to most of these people being scammed. These types of scams typically rely on the victim allowing greed to shut down their brain. I am normally one to be pretty vicious towards the scammers in things like credit cards and predatory lending, because often enough it isn't exploiting greed and get rich quick schemes so much as it is a genuine fraud and manipulation. This subprime crap and scams like this are almost exclusively greed driven on the part of the victim. Listen to the radio and you will hear dozens of commercials per day on how to get rich quick in real estate, flipping houses, or whatever other genious plan being sold. I can't imagine why someone selling real estate would try to sell a system of how to get rich by buying real estate...

    --
    The only change I can believe in is what I find in my couch cushions.
  7. Re:EVE Online is a different monster by Planesdragon · · Score: 4, Insightful

    I'm sorry, Eve has real consequences for failure. It's wide-scale PvP, in a way that actually makes roleplaying make sense.

    Compared to the endless grind of City of Heroes or World of Warcraft... well, finding a way to deal with scammers in Eve is what makes it the only MMO worth playing.

  8. It's not a problem, it's a feature by Idaho · · Score: 4, Insightful

    We're all well aware of the scams that sometimes happen in online games like Eve Online. But despite this looking primarily like a problem with Eve Online [..]

    (emphasis mine)

    Uhmmmm, hello?

    Eve Online is specifically designed to have a player-driven economy and market. As in real life, it is possible to scam people in such a market. This is not just allowed in Eve online, it has in fact been close to actively encouraged (as in, people have asked devs/GM's whether it's ok to do certain things, and got a reply that amounts to "if it's not obviously prohibited by the EULA, go right ahead". It has made for some nice stories as well, some people may remember the story about the Eve Intergalactic Bank piramid scam.

    The devs consider this kind of thing to be exactly as intended and have even stated so in public forums. So yes, it's a harsh game. It is actually possible to lose the work of several months in a matter of minutes.

    Of course, there are still rules/an EULA, for example it's not OK to phish for account details, to sell or buy in-game money for real-world money, etc. However, if you manage to convince hundreds of people that they should invest in your piramid scheme, you should absolutely go right ahead.
    --
    Every expression is true, for a given value of 'true'
  9. Virtual NSA, virtual FBI by Animats · · Score: 4, Informative

    Already happening. From a Linden Labs press release: The company also introduced algorithms that identify suspicious activity...

    A virtual world is a total surveillance society. Everything can be logged. More than that, what you do there can be analyzed automatically.

    Big Brother is watching. Big Brother is always watching.