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Category — Virtual Crime Cases

China Curbs Use of Virtual Money

Categories: Agency/Board ActionsVirtual Crime CasesVirtual Property CasesVirtual Property Taxation

In an effort to stave off a new form of money laundering, prohibited gambling and threats to the Chinese yuan (Chinese currency), Chinese Web sites have been ordered to limit the use of virtual money. Public prosecutor Yang Tao says “The QQ coin is challenging the status of the [yuan] as the only legitimate currency in China.”

Specifically, virtual money may only be used to buy virtual products and services the companies provide themselves, issuance will be limited, and users are “strictly forbidden” from trading it into legal tender for a profit.

QQ coins, issued by Tencent.com – China’s largest instant-messaging service provider – are the most popular form of online credits used by 220 million users. They are being used to pay for an increasing array of services including gambling, phone sex services and shopping online


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Article: Are Virtual-reality Games the New Wild West?

Categories: Featured ArticlesVirtual Crime CasesVirtual Property CasesVirtual Property Taxation

Dan Bradbury writes an interesting piece in Backbone Magazine about the virtual goings on in MMORPGs and some of the legal implications. Among other things he discusses Mark Bragg's virtual property case and a virtual "mafia" of sorts in Second Life where users take it upon themselves to enforce the rules within the virtual world when no other recourse is available.

Source: Backbone Magazine

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Group Prosecuted in China for ‘Arms Dealing’ in Legends of Mir

Categories: CheatingHackingVirtual Crime CasesVirtual Property Cases

A former deputy manager of Shanghai-based Shanda Network Development, Wang Yihui, and two accomplices are being prosecuted in China for illegal virtual weapons trade. Mr. Yihui changed the underlying game database of the popular Legend of Mir video game to produce, and replicate, two high powered weapons and provide them to two registered gamer accomplices. They, in turn, sold multiple copies of these weapons for profit. The group was able to make around $250,000 between September 2004 to August 2005 by such sales. Users of these weapons have an unfair advantage that allows them to advance through the game at a much quicker pace. The group are being prosecuted for copyright infringement.

Sources: Bit-tech.net | ars technica | Live Science | Spong | Taipei Times | 7 Days | IEET | War Cry | China Post

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Is an Eve Online Ponzi Scam an Actionable Fraud or Taxable by IRS?

Categories: Virtual Crime CasesVirtual Property CasesVirtual Property Taxation

Gamer’s with Jobs has a very interesting article about a recent Eve Online virtual ponzi scheme where ‘Dentara Rast’, the gaming name of an Eve Online player, scammed 700 billion ISK (the in-game currency) from other players. Given that ISK is convertible into real-world currency, making his ‘winnings/earnings’ from the scam roughly equal to $81,667 USD, would the other players have an actionable real-world fraud claim against the player? Are his ‘winnings’ taxable by the IRS? If Dentara Rast does not convert his winnings into cash, are his winnings taxable on the same theory as unrealized capital gains from exercised stock option purchases? Does Eve-Online’s EULA, claiming ownership rights to all in-game property, affect the result given that ISK is bought and sold on e-Bay in contravention to the EULA? Or, does the voluntary participation of other gamers in the free-wheeling, unregulated, world of Eve Online, comprise implicit consent (as with a poker-player’s implicit consent to being lied to by another player that bluffs) to in-game fraud and other shenanigans that would be illegal in the real world? All interesting questions explored in this article.

Sources: Gamers with Jobs | Joystiq | CNet | Gaming Insider | Gamasutra | Game Politics | Google Cache | Dentara Rasts Downloadable Confession

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Chinese Man Looses Appeal to Reverse Conviction for Stealing Virtual Property

Categories: Virtual Crime CasesVirtual Property Cases

Last December, Yan Yifan was convicted of stealing virtual property and sentenced to a fine of 5,000 yuan (US$617) by the court of Guangzhou’s Tianhe District. He appealed on the grounds that virtual goods should not get legal protection. The court found that, because game players had put time and money into getting the virtual equipment and because Yifan had profited from selling the goods, they did deserve protection.

Sources: People’s Daily Online | The Register | CNet | ZDNet | CRI 1 | CRI 2 | Reuters | Top Tech News | P2PNet | Washington Post | Zinhau Net 1 | Zinhau Net 2

Dale’s Comment: I find it ironic that the law of virtual property seems to be developing in communist China where property rights are historically lower than in capitalist countries. Given the enormous amount of time people spend accumulating/earning/winning virtual property within MMORPGs, I see virtual property as equally deserving of property protection as, say, lottery winnings. Clearly there is an increasing real-world value to virtual property. To the extent virtual property can be monetized in the real world, I submit that it should be given legal recognition as a property interest deserving of protection just like any other property.

See, for instance, the new and wildly popular Second Life MMORPG where users frequently use real money to purchase virtual property. Second Life actually publishes how much money is spent in the game each month. Real currency is converted to the in-game $Lindex currency and, through the games ‘Marketplace’ users can convert $Lindex back to real currency. Clearly, this “virtual” property has real-world value that if stolen etc. may give rise to enforceable property rights in the real world. I doubt it will be long before this type of case makes its way to the courts.

See also, the many related gold-farming stories referenced in my March 16, 2006 post. See also the related June 8, 2005 story where a Shanghai man narrowly escaped a death sentence after killing another man that had stolen (and sold0 his virtual sword. The man committed the murder after first being rebuffed by the police when he approached them for help in the matter. The police turned him away because virtual property, at that time, was not recognized as property.

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Video Games Create a Whole New World of Legal Liabilities

Categories: CheatingFeatured ArticlesProduct Liability CasesStartup Game Developer IssuesVirtual Crime CasesVirtual Property CasesVirtual Property Taxation

Chris Bennett, of Davis & Company, LLP describes numerous possible new legal liabilities flowing from video game play. He discusses online theft, online assault, offlline assaults and cheating.

Source: Lawyers Weekly

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The Virtual Crimewave

Categories: Featured ArticlesVirtual Crime CasesVirtual Property Cases

The world of online gaming is in the grip of a festering crimewave. As role-playing computer games such as EverQuest and Lineage have surged in popularity, a dark criminal underworld has emerged to capitalise on their internal economies.

Source: Times Online

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Man Arrested for Virtual Mugging in Lineage II

Categories: CheatingPolice ActionsVirtual Crime CasesVirtual Property Cases

A man has been arrested in Japan on suspicion of carrying out a virtual mugging spree by using software “bots” (a form of cheating) to beat up and rob characters in the online computer game Lineage II. The stolen virtual possessions were then exchanged for real cash.

Sources: New Scientist | Gamespot | The Enquirer | BBC | CNet | GamePolitics | Ferrago

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Chinese Gamer Sentenced to Life

Categories: Criminal ConvictionsCriminal ProsecutionsVirtual Crime CasesVirtual Property Cases

A Shanghai online gamer has been given a suspended death sentence for killing a fellow gamer. Qiu Chengwei stabbed Zhu Caoyuan in the chest when he found out he had sold his virtual sword for 7,200 Yuan (£473).

Sources: BBC | MSNBC | PC World | CBC News | CNet UK | China Daily | American Chronicle | NewsSGD.com | CNN Money

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Spurned Woman Charged after Deleting Ex’s Lineage II Gaming Data

Categories: Criminal ProsecutionsPolice ActionsVirtual Crime CasesVirtual Property Cases

A Japanese woman faces a charge of “illegal access” to someone else’s online account after using her ex-boyfriend’s username and password to access online game Lineage II and deleting game data, including weapons.

Sources: Gamespot | The Register | Boomtown | Guardian Unlimited
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