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« Linden Lab Rolls Up the Banking Scams of SL | Main | The Mainland Hostages »

January 09, 2008

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moo Money

Actually, I was just there to watch the train wreck in progress that Spin had told me about. I do love a good protest. Thanks for giving Massively love, though. I feel warm and fuzzy. <3

sean percival

Prok tends to give that fuzzy feeling to some :)

Just like a rash...

Ann Otoole

spray roaches with raid and they flip over and wriggle in a frenzy for a short timeframe then die. so goes the nigerian style scams in sl.

they will wriggle in a frenzy attempting to put a facade of innocent victims up before they simply vanish with the cash. if they were honest they would have held enough money in reserves to cover the inevitable shuttering of illegal operations. but they don't have the cash. its gone. and so will be the scammers in a week or two. simply vanished without a trace and will no doubt reappear on new accounts to perpetuate new fraud schems upon the foolish who think there is something to be gained for no effort.

Land Shepherd

"they will wriggle in a frenzy attempting to put a facade of innocent victims up before they simply vanish with the cash. if they were honest they would have held enough money in reserves to cover the inevitable shuttering of illegal operations. but they don't have the cash. its gone."

Actually, most honest banks in RL only have a small percentage of investors deposits on reserve. It wouldn't surprise me if some SL banks actually had a higher percentage. If a government decided in RL to make banking illegal within two weeks, you'd certainly see a large amount of bank failures.

"and so will be the scammers in a week or two. simply vanished without a trace and will no doubt reappear on new accounts to perpetuate new fraud schems upon the foolish who think there is something to be gained for no effort."

I bet most of the following will be around in two weeks:

LukeConnell Vanderverre
Arbitrage Wise
Shaun Altman
Travis Ristow
Tyrian Camilo
Lindsay Druart

Prokofy Neva

Ann, I think you're almost a victim of the way the mainstream media has played this, based on facile quotes from the "experts" like Duranske, who want to portray this as a Raid can with roaches.

My reporting here shows that it isn't. I totally agree with Land Shepherd that those six people named here will still be in SL trying to cope with this situation. They were all on the floor of the banks or exchanges they had helped to create last night, not running off to Acapulco.

These people built businesses in SL, not fly-by-night scams. And I would put Nicholas Portocarrero in there as well. I don't think they deliberately intended to scam people and run off with the game gold. If they had, they'd have run off by now. They have suffered losses, too.

All of these people strike me, having seen their actions and heard them speak or even met them in real-life, as people merely trying to make a Second Life. They may not be very competent -- that's another matter. I wouldn't give any of them any significant amounts of money because I think their desire to role-play and have a Second Life may be larger than their ability to deliver on it in first-life terms.

But then, I put money in Pay Pal's money market, and that's often described as risky:
http://www.reuters.com/article/reutersEdge/idUSN1622549020071017

Isn't everything online?

Prokofy Neva

Just like a rash...

Yeah, keep it coming Sean, these are all good examples of just how someone editing the page for Second Life for what is claiming to be a major human-driven search engine on the Internet should all be about.

What a fucking tool you are.

Matt Mihaly

There's nothing stopping any of these "bankers" from running their "banks."

If they want to accept deposits of real value from real people though, it's completely reasonable that they be expected to get a real banking license or financial institution charter first.

If they can't manage that, they have no business running a bank or a financial institution.

--matt

Gen Ferraris

Matt, as in most cases to why ppl chose SL over RL to start up new ventures, is not becasue they don't believe they can handle the job (quiet the opposite), there is something else to it, something Prokofy touched: Some ppl like the art of creating something from sctratch and getting a community together to form grassrots of semiregulations. Another reason specialy for the banking sector is that you not only need ALOT of capital (in my country about 18,5mill USD), with such startup cost it would be a very bad idea to use that license to provide microcredit/micropayments in a small vr world such as SL wouldnt it ? But even if you are stupid enough and you do have 18,5M usd to play with your govt would refuse your application because it would make no financial sense at all... RL regulations and SL's micropayment is incompatible, i'm all for regulating inworld transactions but we need new regulations for microeconomies such as sl.... Btw one thing i've noticed over my past years in sl is that there is no such thing as "A SL community" there are tons "SL communities" or cliques if you will, when gambling community got banned much of the banking community cared less when WE said help us now and we'll help you help you when it's your turn to be banned, ofcourse we were called much of thesame bankers are called today, and just like the casino haters came to life at the gambling ban and both died afew weeks later, so did the bank-haters community form itself, as usual mostly of ppl that never heard of the industry till it was banned or by ppl who have no idea how it functioned, many of the "bank-haters" don't even know that banks offer loans for land (so getting them to believe all sort of megaevil-ponzi-conspiracy-theories isn't difficult, specialy if they're bored).... Honestly i do understand why each biz sector minds its own day-to-day operations over the others, (like i descibed: everybody ignored the fall of slgambling, today everybody ignores the the fall of slbanking... Matt, next time you try to be a smartass please do your research first, because it's less embarrasing for yourself.

BTW. when it comes to running a real bank in SL, it's actualy legally impossible because of the socalled "patriot-act", the personal data this patriotact requires banks to collect is WAY ABOVE what LL TOS allows you to, and as we learned earlier that any biz operating in sl must be in accourdance with CA-State laws and US-FED laws regardless of where your biz operates. And that except mentioning that ALSO any "internet based" financial institution is required to require their firsttime customers to fax in a signed papers that data (that LL TOS won't allow us to collect) with copy of driverslicense/ID... Now imagine asking a typical SL noob to fax in those data just so he/she can rent-to-buy a tiny plot of 512m2s. On the otherhand, screw the content creators, all sl needs is a huge userbase of consumers wich LL can showoff to the megacorporations that believe large userbase sounds sexy, guess thats what you want matt HUGE badass of a grid filled with 100% regulated: ADFARMS (because thats the only way i can describe the sims of most of the RL megacorps have wasted time and money on, yes empty ADFARMS they are but hey they're regulated ADS wich means they have to be healthy for me ;)

Prokofy Neva

Gen, you raised an important issue here. What kind of regulatory agency is going to give you a license if you only have a million dollars, and want to give out little loands of $2.50 US to buy a first land? And at most have $750,000 US you are playing with. You won't get a license to do that. And if you have a license, you couldn't justify the staff time fooling around in the dollhouse like that.

Yet, amazon and ebay managed to build these empires that can handle transactions where a book costs 25 cents, and only $3.50 for shipping and handling, and the person doesn't make hardly anything off it, and amazon doesn't make much -- but the multiplicity of these transactions, and luring people to the site so that they buy the bigger ticket items like the electronic gadgets then makes the business.

So it has to be something on that model, I guess.

Land Shepherd

I don't think it makes any sense for a "real bank" to come into SL, at least at this point. There doesn't seem to be much of a plus side financially and lots of potential liability. Why bother with this silliness if you are a RL incorporated bank?

Good point about the "gambling-haters" and "bank-haters". I think these cynical folks tend to hate a lot of things and are very vocal. I'm sure if they could, a lot of them would get rid of the evil land flippers. After all, we just scam innocent newbies out of their money by buying and selling land and offer no content or value whatsoever.

It's unfortunate. The loudest critics of gambling and "banks" tend not to have even participated in these activities by their own admission. Yet they rejoiced with glee when they were closed down. I see few ex-users of these businesses really complaining. Most ex-users say something like "yeah, I lost some money but it was fun, that's the way it goes".

I think this trend of dragging RL regulations and requirements into SL will continue unabated. Who knows, twenty years from now you may need an engineering degree to get a LL license to build cars for resale in SL. After all, you wouldn't want innocent newbies scammed out of their lindens buying inferior products created by lowly amateurs, right? :P

Prokofy Neva

Land Shepherd, you've summed up a huge problem I've been writing about for 3 years, which is about a kind of class warfare.

The tekkies (and as a botter you may include yourself among them), and some of the professionals who aspire to becoming tekkies or collude with them, have a real distaste for anything related to land, socializing, mass culture -- anything that isn't based on the premise that "everything is digital and code is law" and isn't in a sort of esthetic vain of cool or geeky or whatever as they understand it.

Everything that is outside the sphere of "code is law". You know, arbitrary things like "land" -- which isn't merely code and pixels but something more intangible. Like social relations. Like mass culture.

This elite is constantly trying to stamp out the existence of this other, larger class, and build the New Society with themselves as the New Class by outlawing them, ridiculing the others, minimizing them, whatever it takes.

Everything to do with land has always annoyed, if not angered and made fearful, the scripting class, the coders. They hate the thought of some other class gaining some sort of base of power that doesn't revolve around them and their skills -- which they hope to keep artificially in demand.

Heaven forbid that a 48-year-old housewife from Kenosha who works part-time at Wal-Mart and drives an SUV should spend $2000 and buy herself a sim and operate it and make money from it -- and run it like a geek would have only a few years ago, in what would have been his private domain where he reined supreme, making everyone else queue up to him as "web master".

Duranske is one of those not only out there rejoicing with glee, but screaming for blood, and pointing a boney, judgemental Puritanical finger at Philip Linden. My God, he's unhinged.

Look at this, a story on the front page of Technology Review, the prestigious MIT publication, where my screenshot from yesterday's blog is on the front page:
http://www.technologyreview.com/Biztech/20037/

and here you will see Duranske ecstatic that the banks are going to the wall, and his expertise is being cited -- and he can't help but go into high Sycophanske mode, and gushes to the Tech Review guy that Linden Lab's decision to close the bank was likely tied to the appearance in this self-same Tech Review of an article a week or so ago called "The Fleecing of the Avatars".

*Rolls eyes*. I put paid to this theory in my comments, of course, but what if it is true, that the Lindens look over their shoulders at their peers in their little wonky geek circles, where MIT denouncing their banks might really bother them more than their own customers getting shafted, and where weeny little Duranske, a non-practicing attorney, could give them the jitters over a possible lawsuit?

Well, what does that mean, then? I ask this very starkly. Does that mean that non-practicing Internet lawyers and technology journals on the Internet get to decide in advance what is legal and illegal, spout it from their bully pulpits and shut down things they don't like, that they find either a threat, or culturally or morally distasteful?

Oh, Duranske claims it's only "about the math." Why if you have "60 percent interest" actually, when Ginko's closed, it was promising 14 percent, but whatever), if you have "stolen $750,000" (does he have documentation?) then it "must be" a Ponzi scheme?

Well, leave aside the basic anarchal WTF I want attitude of SL that says, "Hey, if I'm dumb enough to buy into a Ponzi, that's my funeral, get your paws off my life, who are you to regulate me".

Just ask whether this math is even the math that really pertained. After all, a lot of Ginko was tied up in stock in...the WSE. Which consisted of shares in companies that IPO'd on that Exchange and got the start-up capital they needed to launch businesses in SL -- not all of which were failures.

Oh, it may well be a house of cards. But they've done nothing more to prove it than anybody else -- they just figure it's so, and of course, that's because they wish it to be so.

They wish to be superior to others, to criminalize them, to be the ones on the white list, not the black list.

That's because they want to make their own value rise in this market of reputations. They also see a lucrative career ahead advising clients on the dangers of the Metaverse (which as we know, from Duranske's tendentious page denouncing me, includes warning Metaverse travellers of the dangers of bloggers like Prokofy LOL).

Prokofy Neva

Blak Hax is not welcome to post comments here due to repeated griefing of my properties and harassment of my tenants on a number of sims, as part of the Woodbury/b/tard incessant griefing operations.

Whatever the content of the question, people who cause me SL or RL damage do not get to publish here.

Maklin Deckard

"At the World Stock Exchange, LukeConnell Vanderverre was holding court, talking in Voice and avoiding any typed statements." - Prokofy

Ayep, because voice is not logged at LL like text chat. Wouldn't want to say anything which might be logged by the chumps, er customers (or LL if pulled the logs or someone sued and there was a discovery ala Stroker) now would we?

Right there, I question his honesty / integrity..a verbal agreement is not worth the paper its wrtten on...but like many, I suspect he will survive this and probably prosper in the future. That kind usually do.

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