If a player IN second life does a patently fraudulent thing...there is some tiny expectation that the lindens can help you recover your loss...keep in mind that off-grid endeavors, meaning that the WSE is NOT transacting on the grid..they are doing trades on their own website, so the lindens cannot do anything to help you.....again..most interesting...
I agree with you, sad to relate.
When I had initially looked at this I thought there may be a predisposition towards fairly straight dealing, coupled of course with inexperienced business people. That analogy could be one of many that are a fair description of the LSE AIM market.
This view was based on the standard Second Life residents’ strong dislike of "copybot" and "texture" type fraud and copy write breech
In addition I still maintain that it could be hard for a full time Second Life business needing more than the usual (credit card) type initial finance to get a start. Hence my initial interest, especially in the land and casino business.
But the US FBI interest and uncertainty over the legal status of gaming, together with the relatively high incidence of potential fraud may eventually kill this off. 1% potential fraud can be mitigated against, 10% could become contagious, and the previous posters have got a point about dividends and the ratio of potential fraud.
It is very difficult if not impossible to achieve contract enforcement within Second Life between individual avatars, UNLESS enforced by Linden Labs. In turn Lindens ability to enforce external non-world risk is almost zero.
I am now satisfied that Second Life is an economic game, it is not in my own opinion an enabling platform such as a 3D web browser, except that of some perceived first life corporation branding, which in turn is not actively liked by a majority of Second Life residents, who again in turn see Second Life as escapism from first life. Indeed I know many avatars will not visit or shop on a (corporate) (first life) Island
Finally I note the vast majority of Second Life residents guard their first life real ID very carefully indeed, and would not normally dream of taking first life into Second or the reverse. That is another very big barrier to climb, for example how many people would use their credit or debit card within SL to purchase first life goods and services.
Sorry to be negative but I am just expressing my own views, others may have different views, however I would hate to think of anyone loosing money they could not afford to write off without regret, or to be unwilling victims