Thursday, January 4

Money Laundering Made Easy

Kenneth Rijock over at World-check brings up an interesting thought about virtual online games and how they are handling the exchange of currency. Basically the easy at which it is to get an account if with little ID verification, to translate real world cash into online currency, transfer it to another account and withdraw that back as real world cash. Basically the perfect money laundering scenario with little t no oversight. Here is a scenario he presents:
  • I open 15 to 25 accounts at the virtual universe website, all with counterfeit identification. I fund the accounts with narcotics proceeds cash, all patiently deposited at the available ATMs by my smurfs.
  • I then purchase some virtual real estate from a co-conspirator, as a partnership of my bogus identities, and funnel all the virtual purchase money into his account.
  • The "seller" can then access these funds, either through ATMs, or through a bank. Perhaps I open a small bank account, using bogus ID,and obtain cashiers' cheques with my now-converted "virtual" profits. Is this a great way to move criminal profits ? You bet it is.
And finishes off with this thought:
Have they created a " financial institution" as the term is defined in the USA PATRIOT Act of 2001 ? It would seem that the answer is yes. Let us see just how long regulators and law enforcement allow this scheme to exist before taking action.

So it may not be age play that brings down Second Life and the like.

(via Second Life Herald)