Slashdot Mirror

← Back to Stories (view on slashdot.org)

E-gold Owners Plead Guilty To Money Laundering

Posted by timothy on from the laundering-is-just-a-bad-word-for-privacy dept.

Ian Lamont writes "The three owners of Internet currency service e-gold have pled guilty to money laundering in the U.S. District Court for D.C.. The service is based in the West Indies, but the directors apparently live in Florida. They haven't been sentenced yet, but potentially face decades in prison and millions in fines. In addition, the principal director posted a blog entry yesterday saying that 'criminal activity will not be tolerated,' and pledging to eliminate the loopholes that allowed money laundering to thrive on the service. He also claims that e-gold has more transaction volume in a single quarter than all of the first-generation Web currency services like Cybercash, Beenz, and Flooz completed over their lifetimes. Ironically, one of the reasons that contributed to Flooz's demise in 2001 was rampant money laundering."

5 of 469 comments (clear)

  1. Damn, was an easy way to buy gold... by Anonymous Coward · · Score: 4, Interesting

    This royally sucks because e-gold was actually a very simple and easy way to purchase gold with very few and simple fees, and none of the tax burden.

    1. Re:Damn, was an easy way to buy gold... by alexgieg · · Score: 5, Interesting

      I think you're seeing history inverted. I look at the 20th century, and I see cycles an interminable sequence of booms and busts mixed with inflationary and hyperinflationary phases. I look at the 19th century, and I see customer and other prices with almost perfect stability, so much that anyone could save money for bad times by simply storing it in their houses, rather than at some bank, as is required now.

      You also talk about liquidity, but it was precisely the artificial liquidity created during Woodrow Wilson's government, by way of cheap loans at below market rates, that created the boom of bad investments that imploded in 1929. And then it was the New Deal that, by providing even more cheap loans and thus creating more (useless) liquidity, that extended what would have been self-correcting recession, into a full blown, decade-long depression.

      I suggest you search for "1929" and "gold standard" at classic liberal sites such as the Mises Institute one. People usually accuse them of not using measurements as any good scientific method requires, but whenever I read them what I find the most are historical analyzes. These two search terms alone provide plenty of evidence, and good data.

      --
      Conservatism: (n.) love of the existing evils. Liberalism: (n.) desire to substitute new evils for the existing ones.
  2. eGold now, Paypal next? by whoever57 · · Score: 4, Interesting
    From TFA:

    In harmony with this transformation, we acknowledge that e-gold is indeed a Financial Institution or Agency as defined in US law and should be regulated as a Financial Institution. E-gold Ltd.

    Nw if the federal authorities could get the same concession from PayPal......

    --
    The real "Libtards" are the Libertarians!
  3. If you didnt RTFA... by carp3_noct3m · · Score: 5, Interesting

    E-gold is an online currency service that is backed up by gold. You cannot buy directly from them though, you have to buy through a redistributor, some of which are questionable and only takes certain forms of payment. The nature of the having a third party buy from egold and then sell to another person creates a web of denial effect for money launderes. One of the largest schemes e-gold is used for is in the credit card theft hacker rings, where it is easy to get credit card info, it is harder to "cash out". This is where "cashiers" come in, usually charging a 50 point take on cashing out for someone else. Egold, since it was in a different country, denies US Government requests for transaction records for accounts. E-gold may be in trouble, but for every e-gold there is another replacement, e-platinum, webmoney, and large handful of others. Oh yeah, btw, I didnt RTFA either, I just thought Id share what I know about e-gold, and I might be wrong about some of it.

    --
    "It's ok, I'm completely secure as long as my iron is off"
  4. Where's the anon online cash, then? by BenEnglishAtHome · · Score: 4, Interesting

    For whatever reason, there are times when people pay cash and have no desire to reveal who they are to the folks with whom they are doing business. (I used to relish, back in the day, going to Radio Shack and refusing to give them my zip or other information as long as I was paying cash. They thought I was weird. I thought being forced to identify myself to buy batteries was just too stupid to put up with.)

    So is there any way to anonymously pay for things online? I can think of only one: buy a pre-paid credit card for cash and use it online. Non-reloadable gift cards can be purchased for cash and activated for use online under any name you can think up; there's no verification.

    However, that method is inconvenient. Do the slashdot hordes know of a better, easier way that remains anonymous?