By the way, what has been James Turk's take on all of this so far?

"He did not use such sane words when commenting publicly on a major media outlet recently. In fact he pretty much sided with the fed and trashed e-gold."

I'm not sure what "major media outlet" you are referring to, but I did write the email appended below to Bill Murphy at www.lemetropolecafe.com after he received questions from his subscribers. I recommend that you read the indictment in which the feds lay out their case. It is informative, particularly their statement that $145,535,374.26 of payment volume was made through accounts involved with ponzis, credit card fraud and child porn. http://www.usdoj.gov/criminal/pr/press_releases/2007/04/CRM_07-301_042707_eg... The essence of the indictment rests upon something I discussed on this list many times over the years. There are two different types of currency -- bearer instruments (the cash we carry in our pockets) and account-based currency (bank deposits and the like). Account-based currency is highly regulated, which is possible because the nature of the currency itself enables regulation -- each transaction is recorded in an accounting system (in contrast, to cash transactions). So if you operate an account-based currency, it seems you would be expected to follow the law, doesn't it? Back in June 2003 there was a lengthy exchange on this list that referred to the EZ-BUCKS ponzi. It was just one of several exchanges over the years referring to the ponzis in the gold economy. Here is what I said on June 24, 2003, which itself refers to an even earlier post making the same point: quote By allowing a book entry [i.e., account-based] system to harbor obviously criminal activity like ponzis, the inevitable result to me seems clear. As I noted earlier, "By allowing criminal activity to occur within their system, a currency provider is forcing government involvement and action in the gold economy. This result is inevitable..." I don't think I am belaboring this point or my question by yet once again repeating it, because it is important. "Do the gold currency providers clean up themselves? Or do they wait for...the feds to go in and do it?" unquote So the federal indictments do not come as a surprise to me. Here is what I wrote to Bill Murphy if you are not a subscriber to the Cafe: quote Hi Bill In response to the comments you have received, GoldMoney and E-Gold are very different, with very different business practices, and therefore GoldMoney is not affected in any way by what's happening to E-Gold. Based on my observations over the years, there is some merit to of these charges brought against E-Gold. There have been many investigative news stories (Forbes had a big expose early last year, for example) demonstrating that E-Gold is being used for all kinds of nefarious purposes. As an example, here's an example of a typical HYIP spam I recently received. HYIP is an acronym for High Yield Investment Program a/k/a a ponzi scheme. Welcome to the Electronic Commercial Contribution of Money! ECCM-Invest is a high yield private loan program, backed up by Forex market trading. We have a team who are expert on their filed to manage the funds. Launched our website on February 12, 2007. Our professionals take advantage of currency price fluctuations to make profit for their clients by buying and selling major currencies and stocks. Our mission is to provide our investors with a stable value investment opportunity for their capital,by investing in gold or gold futures electronically to gain a stable rate in return. Online program that mainly focused on FOREX and securities exchange. Before we put the investment programs onto the Internet, we have been on our business offline for several years. However, we are a group of professional experts with years of trading experience, so we are a great team that you can trust. Here is what we offer: - 7% Daily for life paid directly to e-gold - Payments made every work day - Minimum Spend: $1 USD - Maximum Spend: $5000 USD - Multiple spends allowed - One month = 210% - Referral bonus = 2% (E-Gold account number. To send on ours e-mail) We don't make illusions and we don't promise sweet dreams. We simply effectively perform the job. The group of our experts works as one mechanism for achievement of the greatest possible result. P.S. Please have in view of, that Forex works only in the working days. ECCM-Invest ) 2007. All Rights Reserved. Now, to you and me "7% daily for life" is obviously a scam, but you may be surprised to learn that there have multi-million dollar ponzi schemes promulgated through E-Gold, which as a result has provided an open invitation for the federal authorities to walk in and make E-Gold's life difficult. GoldMoney has a zero tolerance policy to ponzis, and we will close any account being used in ponzis. Many HYIP operators list our name on their site in an attempt to give them credibility, but people cannot use GoldMoney to make a payment to the ponzi because they do not have an account with us. E-Gold could also have had a zero tolerance policy to ponzis, but chose not to. The federal indictments indicate that E-Gold allows accounts to be opened and operated anonymously, thereby attracting crooks and scammers to use their system. If E-Gold followed best business practices, they would have closed the account of the ponzi listed in the spam quoted above, as well as the accounts of what I suspect are thousands of other ponzis. But E-Gold apparently turns a blind-eye, allowing these scammers to operate. I think the federal indictments are therefore an inevitable consequence. Additionally, GoldMoney is very different from E-Gold for other reasons. First of all, we are based in the British Channel Islands, and therefore not under US jurisdiction. But more importantly, we are careful that GoldMoney is not used unlawfully. We have a customer acceptance policy just like banks and other financial institutions, so in contrast to E-Gold, one cannot open and operate an account anonymously in GoldMoney. What's more, GoldMoney complies with all anti-money laundering legislation in Jersey, British Channel Islands, whose stringent standards are accepted worldwide. Given that GoldMoney does not tolerate the illicit use of its system and will close customer accounts that are used for illegal activities, GoldMoney therefore follows the same high standard achieved by banks and other financial institutions. So to conclude, my view is that the indictment of the E-Gold principals relates solely to E-Gold's business practices, and is not part of any attempt to dissuade gold's use as currency in legitimate ways. unquote I think the above clearly explains my point of view, but there is another theme that is relevant to this discussion. It is a point that I have made numerous times on this list over the years. It is the comparison of our new gold economy to the time-share industry. Here's a quote from a post in July 2003 referring to a newspaper article about criminal activity in E-Gold: quote I can't say if it is the "norm", but it is typical. And this is what I rail against - press like this hurts the entire industry - the entire gold economy. When time-sharing began circa 30 years ago, some companies allowed crooked salesmen and operators. Pretty soon the crooks were running rampant through the time-sharing industry. Those crooks spoiled that nascent industry, tarnishing the name time-sharing for twenty years, and only then after the name was changed to shared ownership and other variations did it begin to revive. The criminal activity was so bad that even the legitimate operators were painted with the same brush because of all the bad press being given to the crooked operators (bad press just like this one in the St. Louis Post). So is history about to repeat with the gold economy? I hope not, but the outlook is dubious if the crooks are allowed to run rampant throughout the industry. What's sad is that it doesn't have to be that way. There is no technological impediment preventing anyone from stopping obvious criminal activity. All the currency provider has to do is close the account of the crook. In this newspaper article, the crook changed his site, which is obviously a scam, but will his E-Gold account be closed? And even if it is, will E-Gold stop the crook from opening another account and start doing the same thing? unquote The indictment in essence say the same thing, namely, that E-Gold allowed the criminal activity to take place, when all E-Gold had to do was close the account, or even easier, make it less likely the crook will open an account in the first place by establishing a know-your-customer policy that is required these days for all account-based currencies. But there is another point here worth considering. It is how badly the reputation of DGC and the gold economy has been hurt by the E-Gold indictments, which have been well publicized. Hopefully the gold economy can get off the path taken by the nascent time-share industry, and I think these indictments are an important message in that regard. These indictments are saying that criminal activity (ponzis and the like) in the gold economy will not be tolerated, and that's a good thing. Let common sense prevail. The gold economy should be built upon productive economic activity -- not ponzis, credit card fraud and child porn. Regards James _______________________________________________ Dgcchat mailing list Dgcchat@dgcchat.com http://mail.dgcchat.com/mailman/listinfo/dgcchat_dgcchat.com --- end forwarded text -- ----------------- R. A. Hettinga The Internet Bearer Underwriting Corporation http://www.ibuc.com/ 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'