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EVE Online Rocked by 700 Billon ISK Scam 154

Posted by Zonk
from the that's-a-lot-of-space-tobacco dept.
Martin Spamer writes "The space MMOG EVE Online, where mining rock plays a big part of the economy, has recently been hit by a huge in-game scam. The aftermath of the EIB scam... was 700 Billion ISK, which might raise some $119,000 USD if sold on Ebay. (The current conversion rate is 100M ISK to 18 USD.) These events have prompted claims of player deaths, death threats, and speculation about What Would You Do With 700 Billion ISK?"
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EVE Online Rocked by 700 Billon ISK Scam

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  • Er... (Score:3, Insightful)

    by rscoggin (845029) on Wednesday August 23, 2006 @05:41PM (#15966161) Homepage
    Can someone explain the scam? The forum link has very little information and presumes the reader has background...
    • Re: (Score:1, Informative)

      by gbrayut (715117)
      Quick google search found this link with more info: http://www.digg.com/gaming_news/Largest_MMO_Heist_ Ever_EVE_Online_700bn_ISK_130_000_USD [digg.com]
      • Re: (Score:3, Informative)

        by generic-man (33649)
        Link to the article [eve-online.com], not the blog.

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      • Re: (Score:2, Informative)

        by Forgery (613737)
        Here's an article that discusses a previous scam for $170 mil. It's an excellent read:

        http://padbot.net/eve/the-big-scam.html [padbot.net]
        • by garylian (870843)
          That was nothing short of scary.

          The worst part was, he was happy trading for a while, and those that wanted to PK gimped the ability to get away, so he out-pirated the pirates.
    • Re:Er... (Score:5, Informative)

      by LotsOfPhil (982823) on Wednesday August 23, 2006 @05:49PM (#15966203)
      It took a while, but... [eve-online.com]
      1) Player Cally starts the EVE Investment Bank in early 2006
      2) A lot of drama goes on in the mean time with people sticking up for the EIB and others calling it a scam
      3) Cally's owner decides it's been long enough and cleans out the bank, netting around 700bil in ISK and another 100bil in assets
      That's really all the high points.
      • by rossifer (581396)
        I personally like the part where he describes himself as being a clinical sociopath [eve-online.com] (the "about me" portion). Lots of dead giveaways in there. The fact that people like that exist is one of the scarier things about human nature.

        I've managed to identify a few people like that from my acquaintances through the years. Every once in a while I get the willies wondering if there have been other sociopaths that I didn't spot.

        Regards,
        Ross
        • I enjoyed the part where he tells people he's smarter than them, then says, "for all intensive purposes" in the middle of several grammar mistakes.

          The sad part is that one day he'll be president.
    • by rts008 (812749)
      Sorry, all I could get is this:
      "
      500 - Internal Error

      The server was unable to process your request.

      Support personel has been notified, no further action is needed."
      And from the second link in TFA:
      "This thread does not exist."

      Apparently they have more problems than a scam, I can smell server smoke from here!

      I don't know if it's related to the taking over of accounts of other MMORPG's or not.
      My buddy's son had his WoW account hijacked last week, totally wiping out all of his character's inventory- he found his
      • by Andy Dodd (701)
        CCP just released a MAJOR patch yesterday. (Unrelated to the scam, I've heard a little about it but since I wasn't involved didn't know any of the details.) Needless to say, the day after patch day isn't exactly the game's most stable time. :)
      • by DrSkwid (118965)
        Nothing to to with RL account hijacking.

        Eve is a trust game where there are no police should you default.

    • Pyramid Scheme (Score:5, Informative)

      by Martin Spamer (244245) on Wednesday August 23, 2006 @05:58PM (#15966243) Homepage Journal
      The 'Eve Interstellar Bank' was essentially a pyramid scheme masquerading as an in-game Investment Bank. It payed a dividend that steadily rose from around 9% a month to 16% to build confidence then when the investments stopped coming in closed shop.
      • Re: (Score:2, Informative)

        by Shardis (198372)
        Wrong answer about it being in-game. There is nothing in-game to support banking, and everything was done by people just handing over unsecured amounts of ISK. Such a good idea. :P

        But hey, there's a lot of suckers in the world that just wanna 'get rich quick'.
        • Re:Pyramid Scheme (Score:4, Insightful)

          by Peter Cooper (660482) on Wednesday August 23, 2006 @07:14PM (#15966626) Homepage Journal
          There's nothing really in real life that inherently 'supports banking'. Putting your money in the bank is, for all intents and purposes, like handing over unsecured amounts of money. Of course, laws and institutions have built up around this to provide a more secure framework, but at the end of the day.. you're putting something at risk.
          • by cptgrudge (177113)

            but at the end of the day.. you're putting something at risk.

            Exactly. And for FDIC insured banks in the USA, the associated risk of a bank account has been reduced to less than the risk of keeping your money under the matress at home.

            Unfortunately, EVE Online has no real governing body to secure banks. "But what about CCP? Couldn't they secure it?", You say? The game has really brought out the worst in some people. If there were real banks, "secured" by them, I have no doubt that it would just rem

    • by Anonymous Coward
      The guy who ran the scam's video bragging about it can be found here: http://dl.qj.net/index.php?pg=12&fid=9542 [qj.net].

      Personally I think this is what makes the game EVE more facinating than others.

      I hope the guys running it don't step in, but rather I hope the players can in-game construct an appropriate response to the guy.

      It'll be very interesting to see if this springs up new insurance companies in EVE to protect against it -- or perhaps a new type of organization to certify banks -- or, etc. In EVE the p

      • I hope the players can in-game construct an appropriate response to the guy.
        Um, what's to prevent this guy from just leaving the game? His character goes into limbo, with all the money, and that's the end of it. Maybe he signs up again under a different name, maybe he just moves on to WoW or whatever.

        I think that's the biggest problem with this kind of scam -- at least IRL, you can't just leave (well, not without a fair amount of effort, anyway).
  • big $, small thrill (Score:1, Informative)

    by smartaleq (905491)
    It may be the biggest scam in Eve so far, but it has far less flair that some of the others. Plus, the perptrator was a prick :-(
    • by dan828 (753380)
      I wonder how this will all shake out...I mean the game's EULA apparently allows this sort of thing, but seeing as how whatever the hell it was he stole does have an actual real cash value, might law enforcement get interested? $130K isn't chump change, and you can't use a EULA to circumvent the law.
      • by Kesch (943326)
        So far society have yet to consider online possesions as true property so he is safe from the law as well. (As long as he doesn't omit $130k in ebay auctions on his next tax return).

        However, cases such as these where online property can be worth substantial amounts of money will probably end up in the books getting rewritten at some point in the not too distant future.
      • Re: (Score:1, Interesting)

        by Anonymous Coward
        How?

        1. There's no guarantee that the dude's going to sell it on eBay. Assuming he doesn't attempt to ditch it through TOS-violating activities such as selling it for real life money, he's not doing anything wrong. See:

        2. EVE isn't every other MMOG. There's no handholding, and short of scamming on activities that involve real life money (character transfers, game timecard purchases) or violate game mechanics, caveat emptor is the rule. That said, it's not as horrible as some make it out to be - day to
      • seeing as how whatever the hell it was he stole does have an actual real cash value, might law enforcement get interested? $130K isn't chump change, and you can't use a EULA to circumvent the law.

        In EVE, it's not illegal to steal someone's ISK. The fact that the ISK can be sold for real-world money is irrelevant.
         
  • Obvious (Score:2, Funny)

    by Anonymous Coward
    What Would You Do With 700 Billion ISK?

    Trade it for a frist post, of course.
  • Apparently.... (Score:5, Insightful)

    by kinglink (195330) on Wednesday August 23, 2006 @05:52PM (#15966212)
    There's like 30 forum posts I can find googling about the EIB scam. but I can't find anyone talking about what it is. Just some dude named Cally screwed a lot of people, and apparently it was legit because of voting or something?

    All I have to say is kudos for getting this story on slashdot since I don't even believe we can call it news. Let's try to at least explain the random stuff we are putting together, or at least keep the topics on stuff a little more mainstream then Eve if we don't want to spend the time actually putting an explination of the facts together.
    • I don't even believe we can call it news.
      I think the news part is that the 700B ISK is worth around $100k and that it is not an offense to do that in Eve, but considered part of the game.
      • Re: (Score:1, Redundant)

        by kinglink (195330)
        Unfortunatly while this is news, the article doesn't talk about the fact that it's not an offense. My point is more that the article is barely news (citing forum posts), not that the action is. Hell any action, real world or virtual, is news.
    • Re: (Score:3, Funny)

      by rokel (986883)
      Yeah, making over $100k off a scam in a video game has no place on a site like this. Really. :P
      • by kinglink (195330)
        Yeah, because writting a story that doesn't describe the scam or anything other then the fact people are pissed about something is news!
    • Re: (Score:2, Informative)

      by Shardis (198372)
      "apparently it was legit because of voting or something?"

      I'm not sure about how you'd define 'legit' in this case. There are no in game functions available to allow for player run banks. Basically, you can whip up a web site, just ask people to transfer you ISK, and sha-zam. You're a bank. People got fooled because they wanted to get fooled. I've never touched any of the so-called Eve "Banks", and I don't intend to util the formal contract system goes in (if then).

      As all of the "banking" organization t
      • by volkris (694)
        There are no in game functions available to allow for player run banks.

        Can you transfer money from other people into your own posession? Can you transfer it back out to other people? Guess what... That's all the functions you need to run a bank.
  • The Scam (Score:4, Informative)

    by sinij (911942) on Wednesday August 23, 2006 @05:54PM (#15966225) Journal
    Details can be found here [eve-online.com] and here [eve-online.com] Scammer used basic Ponzi scheme - set up a bank that gave interest on investments. Used new investments to pay off interest. Eventually, like all pyrmid schemes, it run out of investors so scammer cashed out and made "I won Eve" video. This worked since there are quite a few legitimate buisness in EVE, mostly pawnshops for T2 BPO's, that give good returns.
    • by Andy Dodd (701)
      Actually, so far I have not seen any indication that it actually was a Ponzi scheme.

      According to the guy who perpetrated the scheme (he's come clean, so why would he lie), EIB started out legitimate. It's perfectly believable, there are plenty of ways that a shrewd investor can make money in EVE. The best ways ingame to make lots of money are very capital-intensive.

      In the end, Dentara Rast (the main character of EIB's founder Cally) decided that rather than running an investment bank, they just wanted to
  • I love it (Score:5, Interesting)

    by Kesch (943326) on Wednesday August 23, 2006 @06:03PM (#15966279)
    It's interesting to watch all the scams that go on in Eve, I consider it a great social experiment.

    There are three main features of Eve that create this situation.

    1. Easy-to-use player run capitalist system. (It's easy for anyone to start up and manage a business)
    2. Zero laws against corporate fraud (As pure as capitalism gets)
    3. Anonymity from victims. (It's a lot easier to rationalize ripping off people in a virtual world.)

    Combined together these factors have lead to some amazing corporate frauds and espionage.

    I don't have time/effort myself to invest in Eve, but it's still fun to read what determined Eve players go to lengths to achieve.

    (A thought occured to me while typing this. Someone should offer some sort of contract in Eve. Either it can be done through CCP with GMs backing it and they could even charge for it, or a sufficiently large and militarized corporation could sell contract enforcement. Maybe this has already been done, otherwise feel free to steal this idea and try to make some isk with it.)
    • by cloricus (691063)
      And this is why I love EVE. It is a true mmorpg in many ways and this is one of them...If you are smart enough to scam people and you do it using the ingame restrictions (eg not using any bugs) CCP will not step in and crush you, in fact it loosely looks like they encourage it. Though if this guy tries to sell the 6 billion for cash on ebay or similar I can see him being stomped on quickly by the GMs.

      Idiots and every day people lose money and life goes on. :)
      • Re:I love it (Score:5, Insightful)

        by timeOday (582209) on Wednesday August 23, 2006 @06:35PM (#15966450)
        If you are smart enough to scam people and you do it using the ingame restrictions (eg not using any bugs) CCP will not step in and crush you
        What's "smart" about it? Free marketeers think they hate laws, what they forget is that the market is a system of laws, without which there is no market. If there is no contract law in this game, then constructs like banks will simply be untenable, since there's no reason to think the other guy will hold up his end of the bargain. End result, no economy of interest. How is that good?
        • Re: (Score:3, Interesting)

          by Taimoor (891521)
          In this case, you can just as easily use military power to enforce it. Think about the mafia... they don't go around suing guys for ripping off $100,000... they break their legs.

          --Nick
          • Re: (Score:3, Interesting)

            by cloricus (691063)
            Trust is a big part of EVE and it is very hard to earn considering most peoples introduction to the game goes some thing like this: work work work, o0o0o new ship, ship gets blown up, life sucks, work work work, o0o0o new ship, ship gets blown up, life sucks, work work work, o0o0o new ship, ship gets blown up. This continue until finally you can start to hold your own against other in game players who are out to get you - pirates - and/or you join up with others in corporations where every one is equal in
          • Re: (Score:3, Interesting)

            by timeOday (582209)

            Think about the mafia... they don't go around suing guys for ripping off $100,000... they break their legs.

            All law ultimately boils down to military or police force. Just see what happens if you start out with a minor infraction, say driving 10 mph over the limit, and then ignore or resist the progressively more forceful efforts by the government to make you comply. As for the mafia? Internally, it is not anarchy. It couldn't thrive without a code of conduct that amounts to "law." At the same time,

        • by volkris (694)
          The market is not a system of laws. It's a creature that is born whenever there is a supply and demand of various products.

          Some laws help the market to function more efficiently. People are more likely to take out contracts when there is a device in place to enforce them. Some laws make the market less efficient. In the end, though, laws only affect markets; they do not define them.
          • by timeOday (582209)
            I guess it all depends how narrowly you defend "market." I suppose there would always be some bartering. But even the idea of property itself is a legal construct.
            • by drDugan (219551) *
              Property is just a social convention. We don't have laws that define what the idea of property is -- we have lots that define who owns what -- but property itself, the idea is just a common norm we all have bought into.

              [[ N.B. the world could work a whole lot better once we get away from this notion ]]

    • by MBraynard (653724)
      2. Zero laws against corporate fraud (As pure as capitalism gets)

      Please cite how this is capitalism? Feel free to peruse Hayach or A. Smith for evidence.

      Or was this just something you learned at Slashdot University?

      • Adam Smith criticized monopolies, tariffs, duties, and other state enforced restrictions of his time and believed that the market is the most fair and efficient arbitrator of resources.

        The GP did not equate lack of laws with capitalism, but rather stated that lack of laws (state enforced restrictions?) gave one a purer capitalism. At least thats how I read it.

        • by MBraynard (653724)
          The Smith reference is meaningless. What kind of 'restrictions?'

          The guy is essentially equating 'lawlessness' with capitalism. Lack of laws do not give anyone a purer capitalism - it is the type of laws.

          The system you see in Eve does have some free market qualities but has more in common with anarchy and it's natural outgrowth - fiefdom - than with capitalism.

  • Ponzi... (Score:4, Informative)

    by mythosaz (572040) on Wednesday August 23, 2006 @06:17PM (#15966354)
    ...the scam was your basic Ponzi scheme.

    Get investors to your "bank" and pay them a high rate of return on their investments.
    Use your "success" to get bigger investors. Use their capital to pay out your early investors.
    Get more even bigger investors. Use their capital to pay out most of your investors.
    As soon as you think you can't widen the parymid, close up shop and keep all of the investors money.

    http://en.wikipedia.org/wiki/Ponzi_scheme [wikipedia.org]

  • by Anonymous Coward
    The damn thing is just a treadmill. You mine stuff, get money, mine stuff, get money, buy some mining stuff, mine stuff, get money...

    Boring as hell. Space is an empty wasteland and so is this game.
  • by aafiske (243836) on Wednesday August 23, 2006 @06:25PM (#15966390)
    One of the interesting aspects is that the person who pulled the scam said so, publicly. And said who his main character is. One of the flaws in the game is that in theory, he could have transferred this money to another character he owned and been utterly untracable. But he came out and said 'I did it, these were the handful of characters I used, this is my main who I always play with'.

    More interesting, he's set a bounty on himself of 1.2 bil and gone out looking for fights. (You collect the bounty if you blow up his ship, then catch his pod and blow that up too. A little tricky, but not impossible.) With 700bil in the bank, he can afford pimpin' ships and the best gear, and not worry about when he loses them. He's already been found and podded once (by some members of the Mercenary Coalition, if anyone's curious), not sure if he's going to keep bountying himself. Given his attitude, I suspect he will, since he's looking for a fight and pvp experience.
    • by blueZhift (652272) on Wednesday August 23, 2006 @07:09PM (#15966601) Homepage Journal
      You just gotta love this! Beyond some simple scam, it sounds like this guy is essentially creating game content in the form of this continuing drama. In an age of reality tv shows, this is just perfect.
      • Re: (Score:3, Insightful)

        by Winterblink (575267)
        What's most interesting about it is, EVE is typically cut up by some people for not having a lot of the "traditional" style of content (ongoing plot type of things). They fail to see the overarching idea behind what the game is.

        Provide the setting, the worlds, the tools, and the toys to the players, and let the content manifest itself. In essence, the players make the plot.

        You're right in your statements, this kind of thing is the perfect justification of that concept.

        For tons of EVE-related ongo
    • by DDLKermit007 (911046) on Wednesday August 23, 2006 @08:19PM (#15966909)
      Man thats just the kind of content developers couldn't hope to create themselves. Theres no way they can touch the guy doing that. This is an example of an MMORPG truley succeding.
  • by GoNINzo (32266) <GoNINzo@[ ]oo.com ['yah' in gap]> on Wednesday August 23, 2006 @06:25PM (#15966391) Journal
    If you want the scammer's side to it, there's a video [eve-files.com], and easier to understand, text translation [eve-files.com] of the video. (or just search for EIB on http://www.eve-files.com/ [eve-files.com] )

    But it's basically 'yay i win eve'.

    • by 4D6963 (933028)

      What a small small world. I get this video thanks of the link you post in this comment and a few hours later you revive me in Urban Dead.

      So thanks for the revive!

      -Papa Schultz

      PS : Thanks to your revive I'm now holding alone a NT building right in the middle of the Big Bash at [93,40].

  • Lesson learned? (Score:2, Informative)

    by SupremoMan (912191)
    To fall for a Pyramid scheme one must be really naive. You can make simular scheme in any game you want, just need a gullible populous.

    But then again most of tech stocks before the bubble burst were essencially Pyramid schemes. The only way to make money off of them was to sell before the bubble burst and leave someone else holding the bag.

    • Hah.

      I'd love to see anyone try to see someone try to do this in WoW.

      Blizzard bans accounts for trading gold while running an in-game poker mod.
      Blizzard accounts for transferring large quantities of goods from one character to another with no gold transfer.
      Then again, Blizzard will ban your account if you log into anyone else's account, regardless of whether that person gave you permission or not.

      They will also ban you for

      Anything that Blizzard Entertainment considers contrary to the "essence" of

    • by Abreu (173023)
      Hindsight is always 20/20
  • by Rectum2003 (686009) on Wednesday August 23, 2006 @07:53PM (#15966783)
    What Would You Do With 700 Billion ISK? Two chicks at the same time. Darn straight. Two chicks at the same time.
    • Assuming that you sold it off on ebay for real $$ to pay the hookers...since you obviously are having problems finding two who are willing sans the cash...

      2 cents,

      QueenB
  • by 4D6963 (933028) on Wednesday August 23, 2006 @10:37PM (#15967389)
    Not on YouTube yet? Unless my searching skills are to blame, it's a bit surprising. I was about to upload it myself but I don't really care about that whole story...
  • This could be construed as "income from a barter exchange" by the IRS. EvE should send him a 1099-B form at the end of the year, showing that as income. In the words of the IRS:

    The Internet has provided a medium for new growth in the bartering exchange industry. This growth prompts the following reminder: Barter exchanges are required to file Form 1099-B for all transactions unless certain exceptions are met. Refer to Barter Exchanges for additional information on this subject. IRS tax topic "Barterin [irs.gov]

  • I am not an eve player, but from what I read, this does not appear to be a technical exploit, or a violation of the terms of service, or anything like that.

    This was basicly an in-game version of a pyramid scheme or ponzi scheme. You can read about pyramid schemes here http://en.wikipedia.org/wiki/Pyramid_scheme [wikipedia.org] ... but basicly "A pyramid scheme is a non-sustainable business model that involves the exchange of money primarily for enrolling other people into the scheme, usually without any product or service
  • by aldheorte (162967) on Wednesday August 23, 2006 @11:29PM (#15967549)
    This occurs regularly in Eve, this just happens to be the latest incarnation (the title of "rocks" is way overblown, 99.9% of players in Eve won't even know or care). The basic "problem" in Eve is that there are no enforced laws on corporate behavior. No SEC or FTC. Therefore, it's almost a certainty that any venture that requires joint ownership and capital will ultimately end up in fraud. It's a great study for both libertarian and regulatory economists alike. Although some people may relish the prospect of no government regulation, the problem is that no grand projects of joint capital are possible (they do happen, but they are always under a cloud of suspicion and will ultimately fall to greed in most cases). This means there are no truly reliable avenues of investment (there is also no FDIC for joint ventures). For those who are going to point out that you can buy shares in X venture currently in game, wait awhile.

    Also, imagine the work it takes for one person to run a scheme of this size, dealing constantly with investments, withdrawals, and dividends. Sure, it racks up a lot of cash, but the perpetrator probably had to "play" 23/7 for six months to pull it off, constantly dealing with minutiae. So, yes, well done in terms of a scam, but it takes a hell of a lot of work. Is 700 billion units of virtual cash worth it? Maybe, when you consider how much it could be transferred into real currency if he bought time cards with ISK and sold them.

    However, here another economic curiosity comes into play - the number of people selling time cards is a limited number (you cannot buy time cards from CCP with ISK, someone has to pay CCP real money and then put them up for sale in ISK). Cashing out would spike the sell price of time cards in *ISK* through the roof. He would have to deal both the minutiae of buying and with selling hundreds if not thousands of time cards, which would also drive the cost of time cards down *in real currency*.

    Basically, when you figure it all out and divide the final take in real currency by time spent to do the scam and then transfer it all, I doubt the hourly pay is impressive. So, sorry folks, no get rich quick scheme here.
    • 'The basic "problem" in Eve is that there are no enforced laws on corporate behavior. No SEC or FTC.'

      Is the game robust enough for players to create such laws and enforcement/oversight groups?
      • Not really. The most you can punsish someone would be consistently trying to blow up their stuff quickly so they don't have any fun, or maybe trying to isolate them socially. But there's enough space/people in the EVE universe to make both of those infeasible, and even if you could accomplish them enough to annoy the person, they could always just leave and go play WoW or something instead.

        That would get rid of the person maybe (they could always create a new-anonymous character and get him/her the money),
    • I think you make a great point. As these MMORPGs become more complicated and begin to mimmick the complexity and social needs of reality, you start to see where the inherent design of the game breaks down.

      What's interesting is whether or not those involved in the scam would have just as easily perpetrated it face-to-face with players, whether if something of this nature happened in real life, it could have gone as far, and what that says about people and their virtual lives. Do you trust more in your fake
  • Yahoo says 100M ISK is more than 1,420,000 USD [yahoo.com]. But that may be an other ISK... ;)
  • Interesting. Dentara Rast is the name of a famous assassination target in Frontier: First Encounters.
  • Boring. Repetitive. Encourages griefing. Oh yeah sign me up for a double helping of that.

    The more i hear about this game the less i want to play it.
    • It's only boring and repetitive if you have 1) No imagination of your own 2) A severly antisocial personality 3) Don't enjoy a challenge. The beauty of eve is that every level of player is useful in some way to every other level. You're -involved- from step one, and in a persistant universe.

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