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The Almighty Buck Entertainment Games

Massive Bank Fraud In EVE Online 138

Posted by Soulskill
from the virtual-madoff dept.
djconrad was one of several readers to point out the latest major scandal in EVE Online, the space MMO notable for its large, player-driven economy and the entertaining stories it often generates. A player named Ricdic, chairman of a large in-game bank, decided to embezzle roughly 200 billion ISK (the game's currency). Ricdic exchanged the ISK for about $5,000 to pay off real-life debts. Massively has an in-depth write-up about how the theft affects the game and its players. Since the scandal became public, there's been a run on the virtual bank, and its executives are doing what they can to reassure people that it will continue to exist. Ricdic was banned, not for the embezzlement, but for trading 200 billion ISK for real currency, which is forbidden by EVE's EULA.
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Massive Bank Fraud In EVE Online

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  • Slow news day? (Score:4, Insightful)

    by zergl (841491) on Friday July 03, 2009 @11:14PM (#28577309)

    It happened early June already [scrapheap-challenge.com], though it apparently took quite a while for it to propagate to the mainstream news.

  • Re:Slow news day? (Score:5, Insightful)

    by blankinthefill (665181) <blachancNO@SPAMgmail.com> on Friday July 03, 2009 @11:17PM (#28577327) Journal
    Either way, I don't know why this is surprising except for one fact: That it didn't happen much, much sooner. That's what happens when there's no real world consequences for your behavior (or you think you can avoid them).
  • Re:Slow news day? (Score:5, Insightful)

    by zergl (841491) on Friday July 03, 2009 @11:21PM (#28577365)

    Because for EVE veterans a scam hardly qualifies as "news". ;)

  • Re:Slow news day? (Score:3, Insightful)

    by plasmacutter (901737) on Friday July 03, 2009 @11:24PM (#28577379)

    madoff has been sentenced and the trial is over..

    people have gotten used to the spectacle of embezzlement and ponzi schemes, so we have to find another one.

  • by zergl (841491) on Friday July 03, 2009 @11:58PM (#28577545)

    The reason eve fails is BECAUSE it replicates the real world too well. When you "play" Eve, one gets the distinct feeling that one is actually not playing a game but doing work. The feeling of the drudgery of work.

    Maybe CCP will learn from the financial crisis that a utopian hypercapitalist world is not only a fantasy world, it's not all that fun.

    I have to disagree on that one. EVE is what you make out of it. You can do tedious and boring stuff like run an industrial enterprise (aka Spreadsheets Online), mine asteroids (mindnumbingly boring), do PVE (which is admittedly terrible in EVE) combat or you can go the PVP route (be it as a pirate, mercenary, grunt in one of the major power blocks or declaring war on carebear corps for "protection money") and blow up other people's pixels leading to tasty bitter tears for your drinking pleasure (complete loss of whatever you're flying when you get blown up can lead to amusing smack talk).

    Or you could do something completely different and do the social engineering and scamming (completely accepted by the TOS as long as you stay within game mechanics) that keeps EVE in the mainstream news.

    It's a sandbox, there should be something in it for you to have fun with as long as you can befriend the general gameplay, setting and the UI (which is constantly improving) surrounding it.

  • A Bit of a Puzzle (Score:4, Insightful)

    by hardburn (141468) <hardburn AT wumpus-cave DOT net> on Saturday July 04, 2009 @12:13AM (#28577605)

    I'd like to take a minute to address concerns over EBANK's solvency, that is, it's ability to pay out withdraws. As I mentioned before, EBANK moved a large portion of it's assets into cash and we've been merrily burning through it today as people have drawn their money out in concern. We also haven't had deposits coming in - so the money is only flowing in one direction....out.

    That's ok.

    We still have enough cash to handle withdraws and as of the time I write this; withdraws have been actioned. I would also like to point out a few other things; we have had many persons asking when they can deposit money again, as a show of support and to provide EBANK with an infusion of cash. On top of this, we have had private loans offered to us totaling 100 billion and if we really have to....we still have the ability to issue a Bond or if really required, we may finally launch an IPO.

    Why am I pointing this out? I want to provide assurances to our customers that your money is safe with EBANK. We are solvent and continue to build liquidity even in this challenging environment. Even if we have a solvency issue, we have many options at hand to address that should it arise.

    Again, thank you to those who have expressed support.

    I don't play Eve anymore (purely out of regard for personal time management), but I've read many statements like the above of business dealings in the game (not necessarily about scams, just straight business). What I'm always struck by is that if you're capable of finagling all these things in the game, what's stopping you from doing it in real life?

    When this thought first struck me, I was making plans to run an in game POS as a business, and had produced a full business plan and profit analysis spreadsheet. Which is exactly what you'd expect to need at the start of a real business.

    Supply and demand, buy low/sell high, and negotiations are all key skills in running a business in the game, but no more or less than they are in real life. Real life has a lot more government regulation (CCP takes a largely hands-off policy as long as you're not trading ISK for real money), but as long as you can navigate that, you'll have the skills you need for a real business, too.

  • by ceoyoyo (59147) on Saturday July 04, 2009 @12:16AM (#28577629)

    People in real life are a little less likely to just hand over their money to joe blow. Which is why banks are chartered and insured by the government.

    As far as opening regular businesses, absolutely.

  • Re:Slow news day? (Score:5, Insightful)

    by iocat (572367) on Saturday July 04, 2009 @12:55AM (#28577841) Homepage Journal
    Eve is by far both my favorite MMO and my favorite game I don't play. Anytime the world is getting boring, you can count on some major scandal or event in Eve to pep things up.
  • Re:Slow news day? (Score:5, Insightful)

    by jollyreaper (513215) on Saturday July 04, 2009 @01:25AM (#28577957)

    Trust is inherently illogical and irrational and yet it works. Society is built on networks of trust -- most of our institutions and infrastructure that allow life to go on the way it does right now depends on the vast majority of people playing by the rules. Rules which, for the most part, are arbitrary. There are very few rules that are "naturally derived" -- For example, not murdering people is a naturally derived rule because we can't exactly make going extinct legal. O.o Traffic laws are, for the most part, arbitrary -- red means stop, green means go, drive on the left (or right), etc. But we'd never be able to use the shared public resource (the highway) without them.

    Human beings are social creatures. In order to survive, we have to trust one another. Every social organizational structure is derived from this basic concept -- it simply varies in how we trust, to what degree, and to whom.

    If you think about it from an evolutionary point of view, trust is an excellent adaptation for a social species. Being trusting is the sort of thing that might not work so well for a given individual but works out for the species in the long run. It's like cuteness. What's the evolutionary purpose of finding creatures with infantile features and proportions cute? Easy: it's so we don't murder our young. If those little darlings didn't worm their way into our hearts at first sight, it's for damn sure they wouldn't make it through the third night of random crying, feeding, and diaper changes.

    Of course, it's always possible to push the boundaries of society to the point where people stop trusting. We're in danger of this very thing right now. I mean shit, there's a lot of trust involved in working for two weeks with the understanding that there will be a paycheck on payday! I've seen smaller companies so fucked up that the boss has to pay on a weekly, sometimes daily schedule because people don't trust him. We're seeing that in the economy at large as the expectations of the common citizen have become more and more cynical through time. Republicans exist to fuck the poor to death. Democrats exist to pretend to be an alternative to getting fucked to death and while they're taking no direct part in the rape, they're standing in the corner stroking their puds while the Republicans go to town.

    Once that social contract is broken, all the scotch tape in the world won't put it back together again.

  • by GryMor (88799) on Saturday July 04, 2009 @01:43AM (#28578033)

    EVE moves faster than real life, being a game, getting a basic income is easy through a variety of means (mining, piracy, manufacturing, bounties and, in this case trade). Proper management of capital can trivially have returns of 10% a month with almost no work or 100% in a few days on the market with a lot of work.

    This is coupled with high risk, but it's in game risk. Even wiped back to 0 you can recover back to 'normal player' levels radiatively quickly. If you took the kind of risks that are normal in game in real life, you would lose people their life's savings.

  • by GryMor (88799) on Saturday July 04, 2009 @01:50AM (#28578071)

    Loans are EBANK's bread and butter. The loans are mostly collateralized (there are in game mechanisms for locking resources so they can still be used by a third party but can't be moved) or guaranteed by a trusted party (effectively using their reputation as collateral).

    Added to the compartmentalized capital management they have, and no one person can kill the bank, take 200bn? Sure, but that isn't death, just a really big chunk of profit...

  • Re:Slow news day? (Score:3, Insightful)

    by KDR_11k (778916) on Saturday July 04, 2009 @04:32AM (#28578681)

    It's a game about betraying, conning, etc. Only the RMT part was an issue at all, Eve is all about ripping others off ingame.

  • Re:Slow news day? (Score:3, Insightful)

    by Exception Duck (1524809) on Saturday July 04, 2009 @06:11AM (#28578971) Homepage Journal

    Should it be illegal to scam people in the game ? As I understand it - this is part of the game, scamming people....
    Then he broke the EULA - and they kicked him out of the game... Any real world consequences are not justifiable in my opinion.

    What I don't really get is - why the buyer isn't kicked out as well... surely 200 billion ISK in EVE can't be that hard to trace... or do they have money laundering services there ? How on earth would they work in a log-all virtual world.

  • by jonbryce (703250) on Saturday July 04, 2009 @06:34AM (#28579033) Homepage

    And of course, people always tell the truth on web registration forms

  • Re:Slow news day? (Score:3, Insightful)

    by plasmidmap (1435389) on Saturday July 04, 2009 @09:52AM (#28579787)

    If you think about it from an evolutionary point of view, trust is an excellent adaptation for a social species. Being trusting is the sort of thing that might not work so well for a given individual but works out for the species in the long run.

    Except evolution acts on individuals, not species. In order for trust to evolve, individuals must gain benefit from it.

    It's like cuteness. What's the evolutionary purpose of finding creatures with infantile features and proportions cute? Easy: it's so we don't murder our young. If those little darlings didn't worm their way into our hearts at first sight, it's for damn sure they wouldn't make it through the third night of random crying, feeding, and diaper changes.

    It's so we don't eat our own children, which would remove our genes from the population.

  • by Dun Malg (230075) on Saturday July 04, 2009 @01:04PM (#28581075) Homepage

    Not sure who the bigger fool is, the guy that embezzled all the in-game money or the schmuck that paid $5000 of real money for it.

    Try as I might, I can't find a single thing the embezzler did that makes him a fool. He ditched a real-life time and money sink of a habit (EVE Online) and managed to trade it for real-life money and pay some bills. Might qualify slightly as "jerk", but not even a little as "fool".

  • Re:Slow news day? (Score:3, Insightful)

    by petermgreen (876956) <plugwash@p10l[ ].net ['ink' in gap]> on Saturday July 04, 2009 @07:23PM (#28583215) Homepage

    The basic problem is that he was able to convert the in game currency into a real world currency.
    plenty of people want to get ahead in MMOGs for some reason (maybe they just want to play with the higher end stuff, maybe they enjoy being "better" than others, whatever) but can't or don't want to put in the time that it takes (most MMOGs reward those who spend insane ammounts of time ingame) so they buy ingame currency off some site on the internet.

    There really isn't much you can do to stop such activity other than putting incrediblly draconian restrictions on activities in the game.

Today's scientific question is: What in the world is electricity? And where does it go after it leaves the toaster? -- Dave Barry, "What is Electricity?"

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