Thursday, December 3, 2009

Internet Gaming Scams: Look Before You Leap

One of my first published freelance articles in a national publication was called "Look Before You Leap." The theme: how to avoid frauds and scams. Sadly, scammers prey on our natural tendency to trust (until burned), our lack of experience and our naivete.

Words like "no risk offer" and "ironclad guarantee" may sound reliable, but if you are bilked for forty dollars by the one making the scam/promise you are unlikely to hire a lawyer and go to court in Texas or Nevada over it. Telemarketing fraud, advance fee schemes and a whole variety of work-at-home schemes steal peoples' time and money, and erode our confidence.

With the advent of the Internet age, a whole generation has become immersed in this new world, most of us in one way or another building settlements there in various communities from MySpace to Facebook to AOL or whatever. These communities are comprised of people who have various interests, and agendas. Unfortunately, many of the rules in this new territory are undefined and you see a lot of blurring of ethical lines as some people have but one bottom line aim: to make money any way possible.

By now anyone with an email address has received the Nigerian Letter scam, in which someone sends you an email saying they need to smuggle 43 million dollars out of the country and can you help? Because so many have received this email (and it was amazingly effective!) they have changed it into various other countries or situations, always with the same intent, to obtain your bank account number, official letterheads or whatever. As they say, if it is too good to be true, it probably is.

Some ethical lines are less visible. Or like traps in the jungle hidden by leaves and sticks (remember the old Tarzan movies?) you don't have enough experience to see what's going on till it is too late.

Michael Arrington's TechCrunch article titled Scamville: The Social Gaming Ecosystem Of Hell is a must read if you are going to invest time, or money, in the virtual world of FaceBook gaming. After outlining the problems, he sets out actual examples, here's the first:

A typical scam: users are offered in game currency in exchange for filling out an IQ survey. Four simple questions are asked. The answers are irrelevant. When the user gets to the last question they are told their results will be text messaged to them. They are asked to enter in their mobile phone number, and are texted a pin code to enter on the quiz. Once they’ve done that, they’ve just subscribed to a $9.99/month subscription. Tatto Media is the company at the very end of the line on most mobile scams, and they flow it up through Offerpal, SuperRewards and others to the game developers.

Not every scam is out for your money. Many are simply seeking your friends' email addresses and/or contact information, which they sell to advertisers seeking this information. You are essentially betraying the privacy of your friends.

Zynga may be spending $50 million a year on Facebook advertising alone, fueled partially by lead gen scams. Wonder how Facebook got to profitability way ahead of schedule? It was a surge in this kind of advertising. The money looks clean – it’s from Zynga, Playfish, Playdom and others. But a large portion of it is coming from users who’ve been tricked into one scam or another.

If you disagree with the writer, there's a pretty lively follow up debate there at TechCrunch which is equally informative. Before you buy those new high yield seeds at Farmville you may want to check it out.

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