Virus purge on your laptop? That’ll be US$20m, please

Paul Raven @ 11-11-2010

OK, just to pre-empt any angry emails, I’m not posting this to gloat or mock the victim, nor to suggest that this sort of outright bilking of the ignorant is in any way acceptable behaviour. I’m posting it because it’s an astonishing story that says something simple yet profound about the gap of knowledge between technology end-users and technology adepts.

So, the headline says it all, really: a guy from one of those shady “de-virus your computer for ya, mister?” companies managed to screw something approaching US$20million out of composer Roger Davidson, who – pity him as I might – can only be described as a bit on the naive side, and not just with respect to computers [via TechDirt]:

The saga began in August 2004 when Roger Davidson, 58 years old, a pianist and jazz composer who once won a Latin Grammy, took his computer to Datalink Computer Services in Mount Kisco, saying the machine had been infested with a virus. The owners of the company, Vickram Bedi, 36, and his girlfriend, Helga Invarsdottir, 39, became aware of Mr. Davidson’s high profile and allegedly proceeded to convince him that he was the target of an assassination plot ordered by Polish priests affiliated with Opus Dei, a conservative Roman Catholic organization, authorities said.


When asked to remove the virus from the laptop, Mr. Bedi allegedly told Mr. Davidson that his computer had in fact been attacked with a virus so virulent that it also damaged Datalink’s computers, according to prosecutors.

Mr. Bedi told Mr. Davidson that he had tracked the source of the virus to a remote village in Honduras and that Mr. Bedi’s uncle, purportedly an officer in the Indian military, had traveled there in a military aircraft and retrieved the suspicious hard drive, prosecutors said.

In addition, Mr. Bedi told the victim that his uncle had uncovered an assassination plot against Mr. Davidson by Polish priests tied to Opus Dei, according to prosecutors.

Opus Dei was depicted in the popular Dan Brown novel “The Da Vinci Code” as a murderous cult. Mr. Bedi allegedly told Mr. Davidson that his company had been contracted by the Central Intelligence Agency to perform security work that would prevent any attempts by Opus Dei to infiltrate the U.S. government, authorities said.

In addition to the thousands of dollars charged to secure Mr. Davidson’s computer, Mr. Bedi and Ms. Invarsdottir allegedly charged thousands more to provide 24-hour covert protection for Mr. Davidson and his family.

Davidosn’s naiveté is only matched here by the incredible chutzpah of Bedi and Invarsdottir, who – from the sound of it – could have called it quits after the first million and retired into blissful offshore obscurity with no one any the wiser.

But as I mentioned above, this really highlights the knowledge gap between people who simply use computers and those who understand how they work – a gap regularly exploited by botnet operators and other scammy types. The unanswered (and possibly unanswerable) question is: can we ever effectively legislate or educate against this sort of exploitation of ignorance? Or is the sphere of human knowledge simply too large for these sorts of gaps not to occur?

Metaverse bank chairman does a runner with the cash

Paul Raven @ 16-06-2009

Starship screenshot from EVE OnlineYeah, so we’re all tired of hearing about crooks in charge of banks shafting their depositors and borrowers at the same time… but this story’s a little different, given that the bank in question exists in the virtual universe of science fiction MMO EVE Online.

That’s not to say no real money was involved, though; RMT, or Real Money Trading, is one of the few things frowned upon in EVE‘s laissez-faire economy, but it still takes place – and as such there may be a lesson for real-world economists in the story:

Because players often do not have the interstellar credits — abbreviated to ISK, also the official abbreviation of the Icelandic kroner — they need to expand their fleets, an enterprising player created a bank that would accept deposits and lend to players who would pledge assets, like their spacecraft, as collateral.

The bank was a success. According to its Web site (yes, it has one), Ebank accumulated about 8.9 trillion ISK in deposits in 13,000 accounts belonging to 6,000 users. That was far more than it was able to lend out — there were around 1 trillion ISK of loans.

Somewhere along the way Ebank’s top executive, who went by the online handle Ricdic, apparently got greedy. According to CCP, he made off with deposits, which he then sold for real cash to gamers on a sort of black-market exchange separate from Eve.

CCP kicked Ricdic out of the game. And Ebank has temporarily shut down while its board of directors (yes, it had one of those too) tries to sort out the mess. Depositors, meanwhile, appear to have pulled 5.5 trillion ISK of deposits.

It’s not clear how much of that virtual money was embezzled and now needs to be found, somehow, by Ebank. But if the Eve chatter is accurate, it could amount to 10 percent of deposits withdrawn. That could wipe out whatever capital was used to finance Ebank’s loan book. As in the real world, that would spell insolvency.


As in the real economy, the customers could be tempted to appeal to a higher authority — Eve’s creators. That would probably involve appealing to the Council of Stellar Management — a body of nine members chosen by Eve players to represent them in discussions with CCP.

But the word from Reykjavik isn’t likely to comfort Ebank’s depositors. Eve’s creators at CCP — which employs its own economist and philosopher — take a laissez-faire approach, leaving most such matters to the game’s users to sort out. Unlike the Icelandic government, which allowed three local banks to nearly bankrupt Iceland with unchecked expansion, CCP is determined not to encourage entities to become too big to fail.

This is similar to a nasty incident in Second Life a while back, but SL’s banks are governed by US banking law, and so Linden Lab takes a much more hands-on approach to its economy.

It’ll be interesting to see how this pans out; it’s easy to dismiss the travails of a metaverse bank as irrelevant, but as they become more complex (not to mention valuable in real-world terms), metaverse economies may become a valuable testing ground for alternative economic theories. Anything that helps us avoid another real-world clusterfuck has got to be worth keeping an eye on, right? [via MetaFilter; image by Pentadact]

Ginko Financial – beleaguered virtual bank or collapsed ponzi scheme?

Paul Raven @ 06-08-2007

Penny coinsMuch like the early incarnations of the web itself, there are a few tried and tested ways of making money in Second Life: porn is one, of course, and another is financial confidence trickery. The jury is still out over whether Ginko Financial – a Second Life banking scheme that offered 60% (yes, sixty) interest on deposits – fits the latter category; what is certain is that, after a sudden rush of withdrawal requests, Ginko don’t have the liquid assets to give the money back … and they’re none too forthcoming about what exactly they’ve done with it all, either. Common consensus seems to label the whole thing as one huge ponzi scheme, but only time will tell … probably very little time, in fact.

There are other ways of making money in the metaverse, though, with new ones appearing or rising to prominence all the time. Maybe virtual property is a smart business investment for the near future. [Image by Tanya Ryno]