The WSE Hacked & Gambling Ban

So, the World Stock Exchange (WSE) was hacked and 3.2 million L$ were stolen during their current upgrade. From what the owner is saying, the guy they hired to upgrade their software, used the code knowledge to hack the system, make it look like his account had several million and then withdrew the L$ from the ATM and ran with it. And this happened at the same time as when LL banned gambling in SL, and a good 25% of the “stocks” traded on the WSE are gambling stocks.

http://secondlife.reuters.com/stories/2007/07/25/world-stock-exchange-hit-by-l32-million-theft/

The WSE is still down for their “upgrade” after more than a week because their coder ran off with their code after hacking and stealing their money. This combined with the new gambling rules should equate to an interesting day when their exchange opens back up. Like big losses. Not to mention that now some anonymous rouge is running around with their code.

My questions are: Is such an exchange even legal? I mean really, they are raising hundreds of thousands of dollars USD$ for sometimes “real world” firms. Isn’t this illegal? I’m sure the SEC would be interested. Also, how do you think the recent gambling ban and hack will hurt stocks on the WSE?

sounds like an interesting "coincidence" to me.

Yea, and now there are reports that the owner of the WSE tried to cover it all up. Here is the link.

http://metaversed.com/25-jul-2007/coverup-acusations-surface-second-life-financial-scandal

The hack will certainly hurt WSE. They'd better be able to protect their finances before people put money into the system. Can you imagine if the NYSE got hacked in some way?

As far as the gambling ban... I think WSE will rebound from that. The gambling companies will leave and others will replace them... a hiccup, I think.

Theres also a possibility there was no "hack"

*cough* Ponzi *cough*

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with the added benefit that you can serial Ponzi people in a world with no fraud protection.

http://www.your2ndplace.com/

Has a lot of information on this scandal.

I am sooooo glad I never got involved in that mess.

hmm another panic? let's see, LL decrees gambling a nono....and conspiracy theories come about regarding one of SLs leading banks...hmmmm.....

WSE is not a "bank" it is a "stock exchange".

It's not a "stock exchange", it's a "black hole for your money".

my mistake. perhaps it was your thread regarding Ginko and WSE heads being "partners" in buisness confused me.

Gaming establishments, stock exchanges and banking institution are heavily regulated in RL for a reason, fraud, theft, and greed.

It is Not legal where I live, but that is dependent on the laws of you jurisdiction, and LL policy of course.

Unlike gambling, a RL regulated banking or investment firm could set up shop in SL, especially if they were international, but they have not offered services in world that I am aware of.

Presence, yes, but not services.

That should tell you something.

Word is that's not true. They were truly victimized. Of course only time will tell...

"Victimized" because of their own stupidity. If the story that the guy they hired to code their software stole their money IS true, that would be almost as bad as if they had stolen the money themselves. Who on earth hires someone to code banking and exchange software moving around thousands of dollars USD$ without meeting the person first in RL and getting them to sign some contracts? I mean, duhhhhhhhhhhhhhhhhh.

Here is something else crazy! The same guy who won the last Ginko lottery drawing was the same guy who stole all the money from WSE! LOL. Am I missing something here?

http://www.your2ndplace.com/

i never trust rumors of this kind when it comes to a market..
the big crash in the 1920's is a good lesson..
the market begins to plummit everyone panics and everything begins to drop..one smart millionare steps in and says this is gonna turn and dumps 25million or so into the market which back then would be who knows how much today.. pumping up his original stocks and a few others it fools the desperate and Others follow and dump everything they have in it..soon as the first millionare see's his stocks hitting a high he sells pulls out and people start jumping from buildings because his temoprary priming of the market left them even deeper in the original plummit breaking them to the point of suicide..

I think the time has come for Linden Labs to regulate Second Life financial services within Second Life for Second Life residents.

In addition Linden Labs should require people or companies that advertise FIRST LIFE financial services within Second Life (using Second Life as an advertising platform) to provide some reasonable proof they are authorised by the relevant authorities in their first life country of domain.

There is a real risk that both Ginko and the WSE could constitute issues waiting to happen, the recent potential fraud issues relating to the WSE (and reported in the first life media) (source Reuters) is a case in point.

As an alternative Linden could choose to ban Second Life financial services. Ginko's website indicates total deposits of $L195, 577,745 which is around $730,000 US dollars. A bank failure (caused by anything) would be very bad news for Second Life and Linden Labs as it would permanently remove a lot of money from various avatars

How much money in US dollars do you think he got?

Elinah

One article I read puts L$3.2 million as around US$12,000.

Broccoli

LOL! Sounds like you could be onto something!

My RL av cringed at reading this. Not because I think you are wrong - I think that you are dead on. Money and greed are the motivating factors behind many of the most serious issues facing SL lately, IMHO.

Not trying to sound like a paranoid -

But , consider for a moment,

You own a SL Ponzi scheme ..
and you want to get a little cash out
- but you dont want your scheme to fold...

How would you go about it? Say you were robbed, perhaps?

The only way I can see Linden Labs regulating these "banks" is banning them.

That would be sad but necessary if there are real issues.

I would prefer to see greater transparency as in real life financial services, rather than having to glean information third hand from BBs, no disrespect intended

I just dont see the Lindens getting involved in regulating transactions between residents. They firmly maintain that the linden $ has no value.

I think they would switch us over to a USD$ economy before dropping that stance, for legal reasons.

So I see them either doing nothing, or else banning the schemes.

Perhaps you are right when the voluntary Identification stuff happens - these funds managers could volunteer their rl info. But I think you wont see that happening.