AVC Provides MasterCard Debit, Claims It Is Lloyds of London Bonded. (Updated 3:30pm SLT)
Aemilia Ballinger, who has been paying a lot of attention to things, pointed out to me that Atlas Venture Capital (AVC) is allowing people to buy Mastercard debit cards:
08.17.07 - "The Bank" Now Selling Mastercard
The bank has now deployed new ATM machines in all bank locations. The new ATM machines will now allow you to buy a Mastercard Debit Card. This is a real life mastercard, that you can use anywhere mastercard is accepted worldwide.
The cards are sold with some pre loaded USD funds on the card.The options are 10 usd 20 usd 50 usd 100 usd. The cards can be re-loaded with L$ from any of The Bank ATM machines. The L$ will be converted to USD at the posted daily exchange rates.
After all costs and postage for the card, Atlas Venture Capital expects to see 3000 L$ per card proffit. This income will be used to cover some operational expenses, then the blance will be issued as a dividend to all active AVC shareholders.
Our goal is to sell 1,000 cards in the next 2 weeks. Then over the month of sept we hope to sell 10,000 more cards.
We hope to earn over 30 million L$ in the next 30 days, with this new program.
Whoa. That is a step. If they sell 10,000 cards as they project, they would make approximately $108,303 US. Further, if all the cards are at the lowest denomination, $10 US, that would mean that $100,000 US would pass through AVC to the Mastercard owners. At the high end, $100 US, this comes up to $1,000,000 US.
Sounds like a great way to launder money, actually. There have to be limitations somewhere on this, but I'm sure that those details will come to light. Still, the limits of Lindex and other Lindex based exchanges make this sort of transfer almost impossible without alternate avatars - perhaps an army of them. Is that legitimate? I don't know.
According to this article:
The Bank is also announcing a new and innovative service to The Bank customers. World Wide Connect, owned by Lonnie Dagger, has also been purchased by Atlas Venture Capital to provide a Mastercard debit card service to all of The Bank customers. This card will enable people to deposit money into their debit accounts which can then be used with a real life Mastercard to buy lunch, or whatever else they desire, in the real world. There will be no transactions fees for this service, which is bonded by Lloyds of London. This is a first for Second Life and will really change the face of banking in the metaverse.
Lloyds of London? Without verification, that doesn't mean much - so I have an email in requesting verfication from Lloyds of London on this. If it is true, it certainly is big news.
Still, there are very serious questions about this which circle around the limitations of receiving these Mastercards. In a metaverse which has had many dismal failures, it will take more evidence for this to be anything but innuendo and speculation. There is a lot of potential here for abuse and not much information on that readily available.
We shall see. Personally, I'm waiting for facts. Lets see what Lloyds of London says.
Update: In a possibly related article, Dublin company creating debit card for Second Life states:
20.08.2007 - A Digital Hub-based company that supplies debit cards for corporate customers and shopping centres is in the process of creating a debit card specifically for users of Second Life, siliconrepublic.com has learned.
Perfect Card currently provides debit cards for corporate customers like Dell and AOL Broadband implementing reward schemes for employees as well as serving the Richmond Shopping Centre and the forthcoming Quays shopping centre in Newry.“At the moment we have an office in Second Life but we realised that while we have a real world product for gifts we are looking at transferring that into the virtual world whereby someone who is given a card as a gift can convert this into Linden Dollars,” explained Perfect Card’s Nikki Evans.
Perfect Card, which has been in business for two years now, provides debit cards on the back of the MasterCard platform and is actively looking at breaking into new markets and new countries.
“Already people can use our cards to buy goods online,” Evans continued. “We realised that setting up a direct physical sales channel in each country would take years so we looked at Second Life and realised a virtual version would give us access to an audience of 8.5 million people.”
There is no mention of Lloyds of London in the article.
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PCI DSS, lets stop pretending we are finance companies
PCI - DSS
https://www.pcisecuritystandards.org/tech/
http://www.the-logic-group.com/Downloads/PCI_FAQ.pdf
If you start taking card payments via ATM, you will be bound and subject to the above. I would for a start question if the existing source payment method for second life (using the website not SL INGAME) is pci-dss. As it is outsourced one assumes its is.
However the moment you can enter a 'card detail' in SL and it propogates across the SL Metaverse to an aquirer it needs to be covered by PCI-DSS.
Just remind me how SL communicates with the outside world, oh
"LSL receives XML-RPC requests and passes them to the prim specified. It may not establish this connect, but it may reply and keep two-way communication with that server. These responses seem to be able to transport a largest amount of data out of Second Life (vs. Email and HTTP Requests)"
Note the HTTP not HTTPS, thats un encrypted data transfer. For it to be HTTPS every atm would need a secured certificate, or proxied server that was secured.
There is absolutely no way that this solution can meet PCI-DSS, Unless they bypass it by considering the 'cards to be gift vouchers'.
Zal.
The end is near...
This entire situation has disaster written all over it and could very much be the last nail in the coffin to end all financial dealings in SL. Unfortunately, there are no checks and balances to properly regulate such a service. The level of abuse and fraud I'm sure will run very high and rampant.
Needless to say since LL is a US based company and this Mastercard service would be running through their platform, there has to be some tax/regulatory issues that will arise from this very vague and sketchy deal. Any info that AVC has regarding this matter should be disclosed to the public and any legal and tax & accounting expertise would certainly be welcomed.
Wow.
I missed the last 'John from Cincinatti', actually.
But as far as your comment - yeah, this is scary for me in many regards. This could really be a major blow to virtual worlds as a platform of commerce if it isn't done above board.