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E-gold Owners Plead Guilty To Money Laundering
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."
Here I am, looking up "Money Laundering" in the dictionary trying to figure it out.
We get caught laundering money, we're not going to white-collar resort prison. No, no, no. We're going to federal POUND ME IN THE ASS prison.
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.
The police found out when their gold maxed to 2147483647. Everyone knows glitchers get caught.
Nw if the federal authorities could get the same concession from PayPal......
The real "Libtards" are the Libertarians!
They go after these egold folks and the liberty dollar folks because they don't want market forces to be able to leave the growing worthless dollar.
Also bet that Iran will be attacked not for WMDs but because they refuse to trade oil in dollars. These dollar monopolies are one of the few things propping up the dollar and allowing the warfare and welfare state to over-promise.
I bet the vast majority of these gold trades were not for child exploitation and laundering. They want to be able to run the printing presses 24/7 and they don't want anyone to be able to leave the US dollar.
I heard a rattling in my dryer, opened it up and a quarter fell out. Does this mean I'll be doing a nickel upstate? I knew a guy doing a Susan B. Anthony for movie piracy.
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"Ironically, one of the reasons that contributed to Flooz's demise in 2001 was rampant money laundering."
That's really just coincidental.
Conjugal visits? Mmmm. Not that I know of. Y'know, minimum-security prison is no picnic. I have a client in there right now. He says the trick is: kick someone's ass the first day, or become someone's bitch. Then everything will be all right.
So then, you've been reposting a post originally written nearly four years ago, just because it irks you that Roland is capitalizing on his /. submissions? You know, there are much more serious things to get worked up about, why don't you choose a few and make yourself useful? And FYI, you can aways go to your /. prefs page and opt out of RP's stories, and then you won't have to see them anymore.
Caveat Utilitor
Last year Ron Paul introduced the Free Competition in Currency Act of 2007 which would make alternate currencies legal, though not change other aspects of what you can do with currencies (e.g. money laundering would still be illegal).
Few young people realize that until the 1964-1968 time period it was possible to bring your dollars to the government and get precious metal on demand. This gave the dollar real worth. Since that time, the government has found that it can simply make more money out of thin air and spend it on government programs to generate votes. As with any supply and demand equation, when they start running the printing presses to make more dollars, the dollars you have in you bank account become worth less. You're losing money value and the government is gaining money value, but your 'taxes' are low. One can see this in inflation charts which start to skyrocket in the 1970's, relative to decades previous. Interesting note: if we measured inflation today the way we used to back then, our inflation rate would be 11%.
The Wall Street Journal recently ran a graph showing the value of the dollar vs. gold vs. oil. If we look at the start of the decade until now, if we were holding euros instead of dollars, gas would only be about $2.70 at the pump - that extra $1.30 can be viewed as lost power of the dollar. But, the euro is no panacea either - if you compare the price of gas to the price of gold, it's nearly flat. How about $1.20 gas? I actually saw $5 diesel in CT last weekend.
Not surprisingly, the government decided to stop keeping track of 'M3', or the money supply of the dollar recently. Private economists have continued the calculations and it's easy to see why the government doesn't want to talk about it.
So, back to the beginning, the government has taken irresponsible action with the way it manages the value of its currency, and they have laws preventing people from opting out of their mismanagement. Afraid of a little competition, are they? Experience shows that the most likely effect of competing currencies, even ones that mimic the way the government operated in your parents' generation, would be to pressure the government to exercise some restraint. Of course, if this competition is illegal, they'll continue with their outrageous devaluation.
Folks who think a little competition helps to keep markets fair, and monopolies hurt them, would do well to contact their representatives in government about the aforementioned bill.
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Money laundering is a form of aiding and abetting a criminal act. It is basically a catch-all law for various kinds of fraud that are committed with the express purpose of hiding the source of funds either because they were illegally obtained or because they weren't declared for taxation purposes.
Very often when someone commits money laundering they are falsifying other financial documents in an illegal manner. Also, in many cases there are persons charged with money laundering who had nothing to do with the original commission of the source crime. So, it's not just a "pile on", very often its a specific act of fraud someone commits.
It's kinda unclear to me how this shouldn't be illegal. But then, based on the last sentence of your comment you seem to not believe in government and so there is no such thing as "illegal".
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"
e-gold has tried spam as a marketing tool. When they stopped that, other spammers started following suit, phishing for account info--and e-gold's response was always "it's not our problem."
They've been actively aiding money laundering, and claiming they can't control what their customers do. Even now, Douglas Jackson is talking about fixing the flaws in an otherwise good system--despite the fact that he's likely going to jail for a few years.
e-gold is a dirty operation run by dirty crooks. It should be buried deep underground, and the gold reserves (if they really exist) used for something constructive.
"People who do stupid things with hazardous materials often die." -- Jim Davidson on alt.folklore.urban
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?
I and many many others will take gold any day as it is more likely to keep its value than most anything else you can name.
I could say the same thing about any element on the periodic table. Point to any metal on the periodic table and you would have exactly as compelling an argument. We're not making any new platinum or copper either and both are equally useful in a practical sense as gold. Personally I find oxygen, carbon, hydrogen and nitrogen to be FAR more valuable than gold. Perhaps you don't like breathing or food?
Gold is a fine asset to own but thinking of it primarily as money belies a fundamental misunderstanding of the difference between money and value. I suspect that gold will remain a desirable asset well into the future but I don't expect it to be a better source of value than any number of other metals.
That is, the creation and destruction of credit by banks. Banks lent fractionally on top of gold in exactly the way they do now on top of paper. Whether the currency is based on gold or paper is irrelevant with respect to business cycles, it's the debt based nature of credit and in particular fractional lending practices which are the problem there. Gold on the other hand is naturally scarce and so would restrict inflation whereas paper is not, and does not.
HTH
Deleted
Picking up on useful (to the prisoner community) trades can be beneficial to your safety as well. Jailhouse sign-language, as many gangs need people to communicate with the other tanks (50-man sectioned off units), but cannot do so themselves. Also, getting an outside trustee status can enable you to smuggle in tobacco products (or even marijuana if you're brave) with which you can both make money and friends on the inside. You'd also be surprised to find how many friends you can make by smuggling Kool-Aid and cookies from the kitchen back to the tanks, if you've been lucky enough to obtain a trustee position there. The list goes on.
its like talking to someone from some weird parallel universe without any foundation in reality and historical lessons. you're economics stinks of some guy in his armchair trying to figure out how his economy works without any foundation in the simple basics of economics 101. and so all of your economic prescriptives will actually only make things worse, not better
forget the tax objectives, i won't even touch that issue, lets look at this pure insanity of going back to the gold or silver standard. for whatever reason this is attractive to you, i can't figure out
dude: basing your currency on a previous metal leads to bank panics
http://en.wikipedia.org/wiki/Panic_of_1893
the value of the metal fluctuates, and this is amplified through the value of the currency, causing much destabilization of financial systems and society. study the bank panics of the 1800s. LEARN from history. getting OFF the gold and silver standard was the wisest economic development of the last 200 years
the best i reason why i can think that armchair crackpots believe a currency backed by silver or gold is somehow superior is that you think it lends the currency some sort of intrinsic value. which is lunacy: gold and silver have no intrinsic value. the only reason they have "value", is because everyone else thinks they do! well, this same value-from-social-convention also lends currency itself value. except it is far better to attach your notion of what is valuable to manmade currency, as this can be controlled. but if someone finds a bunch of silver in the ground, the value of the silver in your pocket goes down
which is kind of funny, because i think you armchair economics crackpots believe that just printing more money is a source of your currency being devalued... and so you find your supposed protection from this printing of more currency in the form of placing value in something which has much more exposure to fluctuation in value due to forces beyond your control. your willing to give up the stability of a currency, enforced by a careful central bank, to the whims of commodities markets and mining concerns. insane!
but that reveals the REAL reason why you economic crackpots love the gold and silver standard: you detest centralized government. individualism, federalism, etc.: these are all noble concepts. but embracing the gold and silver standard takes a healthy instinct and turns into a pathological fear of government, good or bad
this is the truth, whether you like it or not: you are part of a human society. a currency is something that is only valued in the convention of human society. in other words, attempting to ensure value in something out of the only context in which it has value, is a mixture of stupidity and insanity, and reveals your blind spot in life: YOU are part of a society, and you don't understand it, or pathologically attmept to deny it
any money you have is nothing more than an abstract representation of your relationship with the society you live in. as such, there is no way you get to keep that value in such a way that means you are invulernable to the ups and downs of that same society's relative richness or poorness. you cannot divorce the value of currency from the government and soceity you distrust, fear, or despise, because currency is and always will be (even when it is gold and silver) merely nothing more than an abstract representation that you live in a human group, not on an island, and are subject to its government
intellectual property law is philosophically incoherent. it is your moral duty to ignore it or sabotage it
And drugs are morally objectionable, why?
I've also been hearing that there is no statistically significant connection between CP and molestation. Of course if it really does involve violation of a child, the PRODUCER who actively perpetrated a real crime should be found. of course, that would involve buying the CP to investigate it, and possibly distributing stills of any adults present seeking identification.
As for other "black market" banes of our existence.. there's p2p filesharing (omg the poor record executives!), and cigarettes (damn those people who want to kill theselves and not pay a 70% tax in certain states!), and of course various anonymous whistleblowing.
I don't consider illegal to equal immoral. Governments are increasingly making things illegal with no statistical or moral basis for their claims. They just want control, and our votes are so diluted at this point that a tyranny of the majority exists. Just look at the crusade against the most open part of usenet for an example.
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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 can't store your money in a bank without losing a great deal of value. You have to put it into markets to maintain your wealth.
It's almost as if the head of an investment bank were the head of the Treasury. Wait...
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From the article:
A systemic flaw in the e-gold design, present from the very beginning, made it vexingly difficult for e-gold to expel a User, in a truly effective way, for criminal abuse of the system. e-gold investigative staff might detect suspicious activity, block or freeze the offending account, and later discover the same perpetrator had created additional accounts.
One element was logic that allowed an e-gold account full privileges from the moment of creation and only revoked those privileges in the event of suspicion that the account holder was seeking to mask their identity or actually engage in illicit activity.
Um, systemic flaw? How about important feature? Really charming exercise in doublethink there. "We're crippling the anonymity features that made this product worth a damn in the first place, but we're going to *call* it correcting a 'flaw'".
This is a bloody show trial, that's what it is. It's not good enough to just prosecute their victims, the Almighty State has to ensure they repent publicly, presumably on pain of being fucked over a lot harder during sentencing. "A systemic flaw in the e-gold design...". We have always been at war with Eastasia.
This is the way I did it the last time I did it. Another poster says this is no longer possible; I'm going to test and see for myself. But the way I used to do this was:
Go to an Ace Cash Express store and plunk down cash for an All-Access Visa Gift card. (See the bottom of the linked page.) No questions, no ID, no nothing - you just slide $255 under the bullet-resistant glass and they slide back under the glass to you a Visa card with $250 preloaded. You can take it to any store and use it immediately. However, if you want to use it online, you then go to the All-Access card site, plug in the codes on the card, and activate the card for online use. The activation process asks for identifying information but does not verify. Obviously, if you want something delivered to your home, you'll have to plug in the correct information. However, if you're using the card to pay for something like downloadable software, you can make up anything for a name, address, phone, etc.
Additional info: You can get the card for any amount up to $250. The cost of the card used to be $5. The card is not reloadable. Ace Cash Express sells lots of different kinds of cards and most of them are reloadable so if you're trying to buy one of these gift cards and they start asking you for identifying information, it means they're making a mistake and trying to sell you the wrong product, some sort of reloadable card. Getting the last little bit of cash out of it is difficult; I used to check the credit balance online then go buy exactly that much gas. And if you don't use it, you lose the money because the company charges a small monthly fee against the balance. I don't remember exactly how much (I think it was $5) but it's enough to eat up the balance and kill off the card, eventually.
Note that this info is old. The fees are probably higher and the allowable balances may be lower nowadays. Due to the fees and other hassles, the card is really only worthwhile for the occasional single online purchase that you want to keep anonymous. Still, I know that it *used* to be possible to buy online, anonymously, if you were willing to put up with the hassle.
This actually brings me 'round to my original question. Since the method described above is a bit of a hassle, does anybody have a better way to buy online and anonymously?
It's been a while since I actively used e-gold, but as I recall, unlike such brain-damaged systems as ACH, it was impossible for anyone but the account holder to initiate a transfer out. On the other hand, if you were foolish enough to hand out your account password to random people you were doing business with, well, hopefully you learned your lesson and won't do it again.
There are times which violence ensues. Perhaps one prisoner snitched on anothers' contraband locations - he'll get a bar of soap in a sock to the head or something of that nature. For those people who are just there doing their time and minding their own business, it's not so bad.
There are a few bad eggs (more so than the rest) who are just prone to violent acts, but it is rather rare outside of maximum security facilities.
As for "rape", aside from people who did something to justify being punished in such a way (there's an unwritten code of conduct. "honor among thieves" if you will), the only intra-prisoner sex going on is consensual.
Bottom line, be nice, mind your own business, don't act like you're scared of everything and everyone around you, and you'll be just fine.