Do scams in SL constitute US Wire Fraud?

There seems to be quite a few potential scams in Second Life,

-Scripted objects that directly steal Lindens.
-Various Ponzi-Like Bank or near Bank Schemes,
-Unregulated Gambling / Near Gambling
-Obviously Unregulated Stock Markets,
-Seizure of Charter land purchased in good faith.


Many like banking and gambling have been banned and largely cracked down on .. While others remain.

Does the fact that the Linden is a fake currency shield those who perpetuate such?

If these scams took place using US dollars would they become actual crimes?

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Obviously the fact that these scams persist hurt those who have legitimate businesses, such as Land Barons. A sort of guilt by false-association.

The whole of the situation seems a rather large hurdle that Linden Lab must deal with in some way for more people to trust their whole platform.

And if it isn't dealt with, Isn't a lawsuit by someone who was severely scammed inevitable?

Since it is a product being stolen rather than an actually currency, I think it falls under petty theft.

Regardles of how "linden dollars" are used and sold, they are not a currency in and of themselves, but a product that like any product may be bought, sold, or traded.

Were the scams dealing in real currency, yes. it would be wire fraud.

Daily Summary
]Last Close Date 2008-03-07

Best buying rate:L$265 / US$1.00
Best selling rate:L$275 / US$1.00
Last trade:L$275 / US$1.00
Last close:L$265 / US$1.00
Change:+L$10 / US$1.00Today's volume:L$38,119,706
Today's open:L$265 / US$1.00Today's high:L$276 / US$1.00Today's low:L$265 / US$1.00Today's average:L$267.4521 / US$1.

I think that in SL the pattern of behavior may the key . we have already stated that anyone can make a mistake but repeat offenses are the issue here

WIRE FRAUD - 18 USC 1343, makes it a Federal crime or offense for anyone to use interstate wire communications facilities in carrying out a scheme to defraud.

A person can be found guilty of that offense only if all of the following facts are proved beyond a reasonable doubt:

First: That the person knowingly and willfully devised a scheme to defraud, or for obtaining money or property by means of false pretenses, representations or promises; and

Second: That the person knowingly transmitted or caused to be transmitted by wire in interstate commerce some sound for the purpose of executing the scheme to defraud.

It is not necessary that the Government prove all of the details concerning the precise nature and purpose of the scheme; or that the material transmitted by wire was itself false or fraudulent; or that the alleged scheme actually succeeded in defrauding anyone; or that the use of interstate wire communications facilities was intended as the specific or exclusive means of accomplishing the alleged fraud.

What must be proved is that the person knowingly and willfully devised or intended to devise a scheme to defraud; and that the use of the interstate wire communications facilities was closely related to the scheme because the person either wired something or caused it to be wired in interstate commerce in an attempt to execute or carry out the scheme.

To "cause" interstate wire facilities to be used is to do an act with knowledge that the use of the wires will follow in the ordinary course of business or where such use can reasonably be foreseen.

Each separate use of the interstate wire facilities in furtherance of a scheme to defraud constitutes a separate offense.

"Second: That the person knowingly transmitted or caused to be transmitted by wire in interstate commerce some sound for the purpose of executing the scheme to defraud"

So if I don't use llPlaySound("sound",10) it's not fraud?

I'll give this an hour before a moderators inbox gets inundated with complaints.

As long as it stays in SL, it's not clear to me it can be considered a RL crime. Once the perp draws out US$, then real money is involved, and real monetary transfers, and therefore a real crime. Proving the case in court might be a problem, though.

But of course it's not like it really is "inside" of SL. Unless the parties have some new technology to shrink themselves down and turn into digital avataras.


It would be like saying it's not real, because the fraud was happening inside a telephone cable and people weren't on each end.

The law really says "any writings, signs, signals, pictures, or sounds" so you won't get away that easy!! Oh and it's not just money it covers property too so it doesn't matter if lindens are really money!

*sigh*
...and I'd already started scripting...

Nice name, btw.

The key word is fraud.

If you defraud someone, well, you are gonna get in trouble for it.

It doesn't matter if it is wire fraud, land fraud, interstate fraud or pie fraud. There is some law that covers it somewhere.

What makes me think about it being a legit reason:

Supposedly gambling was banned due to L$ being considered "tokens" that can be traded for cash, just like in a casino.

And to toss a wrench in the gears:

So you get scammed in the USA, and the scammer is in some-country-out-of-the-way. What are the odds anyone will expend the manpower & resources to drag them to court?

Well until a test case comes before the courts we wont know the answer to the OP's question, but we sure can can do our best to document those case we know about. Oh if we make sure we have proof that LL were informed in each such case and did nothing to prevent re-occurences, they they at the very least will be guilty of aiding and abetting or facilitating.

Any lawyers out there feel up to making new case law ?
Any scam victims up feel up to taking this to the next level ?

Am sure it's a question we want answered, and LL aught to be quaking in their boots about.

I would love to arrange that

PRESS RELEASE

Saturday, March 8, 2008

Majority of M2B Depositors Agree To BNT Real Estate Investment Trust Conversion

As of today, Brautigan and Tuck Holdings (BNT) is proud to announce the accession of an additional L$660,000 worth of BNT Financial customers’ assets (many of whom were former My Second Bank depositors) into stock in the new IPO for the BNT Real Estate Investment Trust. This latest round of agreements concerning the compensation of BNT/M2B depositors now means that a majority of the L$4.2 million in deposits held by BNT Financial customers have now accepted the BNTFRE deal, establishing their acceptance as a class of the arrangement.

"It’s a real vote of confidence in the future of the Second Life economy to see an absolute majority of bank customers vote with their dollars in favor of this deal to salvage the asset value of their deposits," BNT CEO IntLibber Brautigan said. "Indeed, every depositor not seeking a direct withdrawal will be compensated with these IPO shares, giving these investors the chance to recoup their original worth and seek new profit opportunities in this growing market."

Former depositors in the closed M2B/BNTF are being compensated by non-depositor investors in the new IPO, for which over 40,000 shares were purchased just in the last day on the Ancapistan Capital Exchange (ACE), a subsidiary of BNT. Of the 4.2 million in deposits, over 2.2 million L$ worth of depositors have voluntarily accepted 100% conversion of their deposits into shares in BNTFRE.

A quick return on dividends is expected for investors of all stripes, as 10 BNT sims have been assigned to Trust management, with land sales generating dividends and the potential of stock buybacks as well. Land sales revenues in the sims is already over L$50,000 which will be paid out as a dividend following the IPO along with other land sales revenues. Tier profits will pay for the ongoing management of the sims. REIT investors can best support their investments by locating residences and businesses in the BNT sims.

"Net Asset Value is being maintained and accountability is our watchword as we restore the trust of depositors," Brautigan said. "Our sims are selling out and we have every expectation of making good on our pledge of restoring faith in the SL market."

M2B/BNTF was forced to close due to Linden Lab policies regarding fraud risk protection and prohibiting payment of fixed interest to depositors. Attempts to reopen under a "contractum trinius" arrangement were rebuffed by Linden Lab, so the bank was left with no choice but to convert to an REIT.

BNT Holdings can always be reached at www.bntholdings.com. For more information or to schedule interviews with BNT executives, please contact Media Relations Officer Charles Gemini at [email]charles.gemini@hotmail.com[/email].

A qualified victim of BNT is testing this very thing.

Here is a link to his Press Release:

http://ossecondlife.com

It would be fair to state that not all of his victims agreed with his offer.

Okay, sorry the link is down, so editing to include a copy of the original:

FOR IMMEDIATE RELEASE:

Contact:
Arthur Burma
Eris Island
[email]arthur@ossecondlife.com[/email]

INTENT TO FILE CLASS ACTION AGAINST BNT FINANCIAL

San Francisco, California, February 25, 2008 - Arthur Burma is a significant depositor in Meta Bank, then My Second Bank, later acquired by BNT Holdings with significant deposits in Linden Dollars. Subsequent failures of the bank to honour withdrawal requests and return accurate records of deposit continued until Linden Lab prohibited the operation of ad-hoc banking in Second Life.

We allege that BNT has steadfastly denied access to depositors funds and failed to remit account balances to depositors after ceasing bank operations. BNT continues to operate and claim profits by posting un-audited financial statements, offering financial instruments for sale, soliciting investors in various entities, and brushing off bank depositors attempting to gain access to accounts.

It is our intention to explore the formation of a class action against the owner and sole proprietor of BNT Financial on behalf of all persons who deposited Linden Dollars in any BNT Financial instrument during the class period. We intend to file in California Superior court, City and County of San Francisco.

We further allege that BNT misrepresented the condition of the institution and perpetrated a ponzi scheme by taking deposits while restricting access to accounts and ignoring requests for records and adjustments. We will ask the court to order BNT to liquidate in world assets; repay depositors, pay the cost of litigation, and other punitive damages.

If you have ever banked at Meta Bank, My Second Bank, or BNT Financial; rented property, or obtained loans or funds from BNT you may be a member of the class and entitled to pro-rata disbursements obtained through litigation or settlement. We have created an in-world registration office where you can apply to be a member of the class. At the moment we only require your Second Life account name, assets at risk, and
consent to participate. We would welcome any additional information and documentation on your experiences doing business with the various avatars associated with BNT Financial, M2B LLC, or any of the properties generally considered to be under the control of BNT staff. You can email this information [email]arthur@ossecondlife.com[/email] or drop in-world note cards on Arthur Burma or Rorok Longstaff.

# # #

Message to LL:

Ya know people will still like SL if Linden's weren't exchangable for real money.

People could still sell things for real money using pay pal.

And ya know. many people would be willing to pay $15.95 a month, if their "premium" membership included a Free Sim all their own. Millions would sign up for realzzzz.

That would make so many more people become paying customers.

Really.....are all these financial legality/scam issues really what you want to have to deal with? Wouldn't you rather have a SL that isn't replete with graft? and serious headaches for you?

You are an MMO, no matter how you slice it. You are not "the internet" You have to be responsible---for security and righting all wrongs.

Limit alts, have them all tied to a master account.

And BTW do away with the terms "buy" and "own" in relationship to land deals till we have it local to our own computer. It's misleading.

I can put that sim right on my hard drive, right next to that free one I already have from one of those new developing outfits.

Think of all that server space you would save if people had their sims on their own computer. Whew...what a load off your back.

k? thx.