BusinessWeek recently published an article titled “Gold Rush” putting e-gold in the spotlight, after its offices was raided by the Federal Bureau of Investigation (FBI) agents, in the USA.
I find the way BusinessWeek starts its article very interesting:
Online payment systems like e-gold Ltd. are becoming the currency of choice for cyber crooks
Crime courses through the internet in ever-expanding variety. Hackers brazenly hawk stolen bank and credit-card information. Pornographers peddle pictures of little boys and girls. Money launderers make illicit cash disappear in a maze of online accounts. Diverse as they are, many of these cyber criminals have something important in common: e-gold Ltd.
This is very true indeed. Web4Africa for example, sometimes receives orders from individuals who later host HYIP sites on their accounts but Web4Africa is prompt to cancel such accounts. HYIP sites from our experience, attract unwanted Denial of Service (DOS) attacks to our web servers.
The summary of BusinessWeeks’ article is that, e-gold is a very suspicious e-currency, that is been utilized by money launderers, financiers of terrorism, scam kings, hackers and people like that. They are suggesting that the creator of e-gold, Douglas Jackson, could be deliberately turning a blind eye to the nefarious activities of his customers.
Well, BusinessWeek’s article has not gone down well with many. Not with me. I find the article heavily biased. I smell a rat.
Just recently, I wrote about “ATM Cards Being Used for Money Laundering” and expressed my fears about the US government cancelling the issuance of anonymous ATM cards, due to its abuse by money launderers. The same scenario could be unfolding with e-gold. The sad thing is, as I said earlier,
In most African countries, credit/debit cards are not commonplace. Thus, the few enlightened ones who need to use one of the global payment networks widely accepted on the Internet (prominently MasterCard and Visa) need to do so via third parties. Though some of these cards are virtual, some are physical and can be used to withdraw funds at any of the Visa or MasterCard branded ATMs, worldwide.
Many of these International ATM cards & VISA gift cards can be funded via e-gold and other major e-currencies. If the Fed agents should freeze e-gold, the sporadic effect on many folks here in Africa would be much. No thanks to our poor banking system/infrastructure, many folks in Africa have had to rely on e-gold/others for transacting business online.
Dr. Douglas Jackson; Chairman, e-gold, Ltd. has since responded to BusinessWeek’s article. He started by saying,
e-gold® has recently been the subject of a slanderous and unfounded article in Business Week. e-gold strongly refutes the allegations and presumptions of this article. The article chose to focus through anecdote and suspicion only on an exception – criminal abuse – and ignores the overwhelming majority of e-gold usage. It also fails to note that all online payment mechanisms including credit cards and intermediaries such as PayPal are targeted by criminals, likely at a much greater magnitude than e-gold, and fails to relate the very proactive steps e-gold takes to eliminate any criminal behaviour involving e-gold.
In my opinion, e-gold’s survival relies on its doing a thorough house-cleaning exercise. Verify the identity of its customers and cancel the idea of anonymity. This great service called e-gold must not go down!
I came to your blog via White African and the discussion of monetizing blogs. The way you wrote “confession time” made it seem like there’s something embarassing about trying to make money from your blog. It’s seems only right to me!
Where’s your donations button? I’m not sure I would donate, just because I don’t have much money. But I just might. What other ways are there to make money from this blog? I’ll bet there are some more.
Of course this post speaks to the importance that people in Africa have access to online payment systems. You are so right. And your perspective needs to be more widely heard. Hardly anyone reads my blog, but I’ll add you to my blog roll today.
Thanks John. The truth is, I meant the “confession time” more or less as a joke. I always like to spice-up my writings with a little bit of humuor. It’s more fun that way.
[…] e-gold has been attempting to reverse this ugly trend for several months now with little success. Criminals still rely on e-gold and some online businesses like EasyDNS have stopped using e-gold entirely. Its brush with the […]