Are EVE Online Players Really That Naive?

EVE Online Ship

EVE Online. Where being an investment banker makes you bad ass.

So apparently there was another bank heist in EVE Online, this time the biggest, craziest, most scandalicious ever seen in New Eden (they always say that though). Except heist is completely the wrong word for it because using that term conjures up connotations of an exciting bank job undertaken by a team of charismatic scoundrels (probably sporting pencil thin moustaches, slicked back hair and suave British accents), fighting against the odds to break into some deeply secured bank vault and then escaping with their lives after an exhilarating fire fight. That didn’t happen here.

Instead what really happened was a scam, pure and simple, and a pretty obvious one at that. Based upon the classic Ponzi scheme (he says as if he’s an old hand at conning people), the two chaps who perpetrated the fraud, Mordor and Eddie, ran a simple business of offering to accept other player’s investment and then paying out 5% interest on their funds back to them every week, y’know just like a bank. If any banks in the world were actually offering 5% interest that is. After a few months though the dirty duo closed up shop, said cheerio, and walked off with all the money everyone had ever deposited with them.

Well duh.

Am I the only person in the world who didn’t see that coming? I’ve played EVE for all of five minutes and I already know better than to ‘invest’ in ‘banks’. I mean, this is EVE we’re talking about. The entire point of the game is to backstab and screw people over. Did anyone in their right mind actually believe that this was an honest and legitimate venture that wouldn’t end up with everyone somehow mysteriously losing their money? Are EVE Online players really that naive?

I don’t think so. In fact, I’d bet that pretty much everyone who gave Morder and Eddie cash knew they would never see it again and I think that was part of the appeal. EVE is a game built upon treachery and lies and I think players like to indulge that aspect of the game, playing along with it at every opportunity. Of course everyone knew Phaser Inc. (the name of the fraudulent investment company) was a scam, they had to because everything in EVE is a scam. And the reality is no one actually needs their ISK that much.

Instead, I think the investors, the people who lost their money, did so willing and knowingly, fully aware of the risks right from the beginning, even counting on it in fact. Because, at the end of the day, having your money ’stolen’ is a lot more fun that just having it sit in your own virtual wallet gathering dust. In many ways, this scam wasn’t successfully because of two people like Mordor and Eddie but rather because everyone decided to play along with it. It gives you stories to tell your corp mates and, probably more than anything else, cause to claim a blood feud and start the mother of all vendettas against the criminal culprits. And that’s got to be a lot more fun that mining asteroids all day long.

So I’m answering my own question here and saying that no, I don’t think EVE players are naive. I think they understand and recognise the risks yet still participate in them willingly because scams like these ultimately make the gaming world a lot more of an interesting place to inhabit.

Its also bloody good publicity for the game.

-Gordon

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33 Comments

  1. Stabs says:

    Yes, they really are that gullible. Many players have funded their game time for years by scamming random players.

  2. spinks says:

    I could see bored players throwing some gold at a slick scamming operation just to see what happened, but not in that kind of quantity.

  3. Gazimoff says:

    I think a few people thought it was worth the gamble. I’m guessing that more got taken in by the testimonials of those who bought in, made money and cashed out. Ultimately though, I think there are an awful lot of nieve people out there who didn’t think it would happen to them.

  4. Ironyca says:

    Maybe another angle could have been: “Are EVE Online Players Really That Trusting?”.

  5. afk5min says:

    I don’t know the full story, but it sounds like a lack of due diligence on the players that invested. There are many legit investing operations going on in the world of Eve. There are even audits done on some of the more reputable IPOs. Maybe it’s a sign of my age, but I love the financial intrigue of Eve. Just like in the real world, people fall for scams in search of a quick buck.

  6. Gremrod says:

    I invested in this one because it seemed legit. But I did only test the waters and invested a small 30 mil. But the 5% payout paid me that much back so I lost nothing. :)

  7. Mytk says:

    “Deposit an investment at Phaser Inc and receive 5% interest on weekly basis…”

    5% per week is what? over 60% p.a., much more with compound interest. Thats a red light alarm siren type of promise.
    How would you make money out of capital in eve anyway?

  8. Nils says:

    Is there actually any proof of the total sum that has been ’stolen’ by the scam ?
    This kind of thing is really good publicity, so I am a bit careful as to whether it indeed happened this way and to that magnitude. And, call me paranoid, but are you sure everybody who invested was a genuine player of EVE Online, and not, maybe, someone with an interest in publicity and the ability to get lots of ISK just-like-that ?

  9. Klepsacovic says:

    No one loses on a ponzi scheme except the last ones in. The last ones in are the ones who have seen the most people get the consistent, promised payout. It’s a simple, but effective design in which the more people you need to trick, the more people there are who can testify to your ability to pay them back.

  10. Gank says:

    Come on…. you give people too much credit. Of course they didn’t participate in the scam willingly. These things work in real life too because of the nature of people…that is to say, they are naive/dumb/greedy/…take your pick.

  11. Max says:

    They hired website designer and writer. They ran operation for 8 months. How much is trillion isk in real dollars now? Was all this worth it? -Regardless I am sure they did it for fun. And its safer to scam in eve. Albeit the rewards for virtual scam are virtual….

  12. Longasc says:

    You can make real money by scamming people in a virtual world and it is perfectly legal in this case.

    It is too easy to get away with such things in EVE as players can do little to take revenge. In the real world scammers always run the risk to get caught with all the consequences. In the virtual world it is not only legal, there is also little what people can do.

    Even if they could shoot the guys in the head in later versions of Incarna, they wouldn’t get their ISK back.

    I don’t know how much effort their put into this but they say they made around 38.000 USD which isn’t shabby.

  13. The thing with EVE is that it just takes some mild persistence to end up with ISK beyond your immediate and even mid-term needs.

    I ended up with nearly 4 billion ISK at one point. I made the first billion in mining, and the rest just running the occasional mission and playing the arbitrage game in the market place.

    Once you have that sort of excess (4 billion was a huge excess for me based on my needs) and somebody comes along offering you an investment that might make money, it is easy enough to throw 100 million ISK that way just on the off chance that it might actually pay off.

    If it does, great. And if it doesn’t, well, there is plenty more ISK where that came from.

  14. Suicidal Zebra says:

    5% per week

    1264% on initial investment compounded over the course of a year?

    If that’s what Phaser were offering and the investors bought in then naive is being charitable. Unless of course those sorts of returns are reasonable in EVE in which case its’ economy is even more screwed up than that of the real world.

    Honestly, I think you’ve probably hit the nail on the head Gordon, to many players ISK doesn’t really matter very much any more. Getting a good anecdote would be well worth the millions of ISK invested, hell they’d probably see it as something of a bargain.

  15. Lors Dornick says:

    I don’t think the correct word is naive.

    I think of the majority of the investors was aware that it most likely was a Ponzi.

    But like many scams (including real life ones) are based on the scammer making people think that they’re smarter than the scammer. And frankly think that they can make money from the scam.

    Like by being smart enough to pull out their money after getting as much profit as they dare before the scam is pulled.

    It’s no different from people spending money on gambling.

    Everyone knows that the odds are always stacked in favour of the house, yet millions upon millions of people risk (more or less hard earned, real life) money into it.

    Because everyone nurtures a little dream that this time they will win, this time they will outsmart the system.

    That’s why scams (and gambling/betting) works. No matter if it’s in a game or in real life.

    • Gordon says:

      “But like many scams (including real life ones) are based on the scammer making people think that they’re smarter than the scammer.”

      I think you’re probably right there. The players probably thought they could outwit the scammers or, at least, pull out before they lost their money.

  16. Bronte says:

    “this time the biggest, craziest, most scandalicious ever seen in New Eden”

    Are you new at this? (See why i have a blog with that name?)

    Have you forgotten the Assassin’s club? Or the corporate infiltration and espionage?

  17. dresdor says:

    You have clearly never spent time in the Market Discussion forum. They are a particular brand of nut-job. Essentially their game is to play chicken with the scammers and try to make money off of them; most of them are scammers themselves. They have their own weird “vetting” process; mostly it involves grinding smaller loans and bonds until they get to the point…so it is a patient scammers paradise.

    That said; Phaser Inc did a lot of spamming to get to their “1 Trillion” which is probably not the real amount they made; but someone had to outdo Bad Bobby (look up Titans 4 U if you don’t know about that, funny story really). The scamming in Eve doesn’t bother me so much as the spamming. Its also hard to run a legitimate business in certain markets that are frequently scammed, which is one of the reasons I quit playing Eve (that and not having enough play time to make it worth spending most of it in transit).

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