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stoicfaux
Gallente
Posted - 2011.02.01 16:24:00 - [91]
 

Originally by: Tippia
But that's just it: there is no risk in the transaction for the seller either — he still has the goods and hasn't lost anything. The way margin trading works means that both parties are equally protected: the buyer does not lose money he doesn't have; the seller doesn't lose items without getting paid.



That's just weak, especially coming from you, Tippia. Yes, there was no loss of meaningful isk in this case. However, there was a serious loss in opportunity costs and intangibles:
* time
* resources - in this case the materials used to create the rigs were probably worth more than the rigs.
* trust - anything that erodes trust in the market erodes the market.
* isk - there was a trivial isk loss in manufacturing fees


Borun Tal
Minmatar
Space Pods Inc
Posted - 2011.02.01 16:29:00 - [92]
 

tl;dr

So let me get this straight: as a professional trader in-game, you don't do your OWN due diligence and jump at what you think is a quick buck, get scammed, and cry foul on game mechanics? Really?

GateScout
Posted - 2011.02.01 16:31:00 - [93]
 

Originally by: Infinity Ziona
Its a ****ty mechanic that would have you arrested for fraud in RL. Unfortunately CCP is too busy making 0.0 safer to fix their logic bugs.

Wrong. An offer to purchase an item is not the same as a contract.

...and stop comparing Eve to "real life." Rolling Eyes


Venkul Mul
Gallente
Posted - 2011.02.01 16:38:00 - [94]
 

Originally by: Muna Kea
Originally by: LindaSpartan 058
Edited by: LindaSpartan 058 on 06/12/2010 10:00:50
Im sure a lot of you know about the market scam where someone finds some rare item, puts up a sell order 10 or so items say 40 mil a peice. Then they put up a buy order a few jumps away for 20 ish items at 45 mil a peice. So being a trader, one thinks they can just move it and make a quick buck. Well of course the minimum volume for the buy order was more than are for sale in the Market anywhere. Recognizing this, I built enought items to fill the order along with the items already for sale on the market. I check every couple seconds to make sure the buy order is still up. When i finally go to sell the items. It says the order is no longer valid. I'm out hundreds of millions of isk. What does CCP have to say?




I lost 700M on that one as well. I went into it with the full knowledge that it was a scam. What I didn't realize was that it was a bot. And no matter how fast a human can click 'sell', a bot can click 'cancel order' faster.

Lesson learned.



Nothing to do with a bot.

The scam is based on the use of the Margin trading skill and a empty wallet.

The scammer train Margin trading to 5, put a buy order for 100.0000.000 paying up front only 24 millions (approximately). He is supposed to pay the other 76 millions when the order is fulfilled but he empties his wallet so the isk are not available.
When the order is fulfilled the system delete it as the buyer hasn't the money to pay.



Caius Sivaris
Dark Nexxus
S I L E N T.
Posted - 2011.02.01 17:27:00 - [95]
 

Originally by: Venkul Mul

Nothing to do with a bot.

The scam is based on the use of the Margin trading skill and a empty wallet.

The scammer train Margin trading to 5, put a buy order for 100.0000.000 paying up front only 24 millions (approximately). He is supposed to pay the other 76 millions when the order is fulfilled but he empties his wallet so the isk are not available.
When the order is fulfilled the system delete it as the buyer hasn't the money to pay.



And it would be so simple to cancel an order when the wallet doesn't cover minimal buy order quantity.

Ok, :ccp:, surely it would be doable to cancel an order when the wallet doesn't cover minimal buy order quantity.

Muna Kea
Posted - 2011.02.01 18:28:00 - [96]
 

Originally by: Venkul Mul
Originally by: Muna Kea
Originally by: LindaSpartan 058
Edited by: LindaSpartan 058 on 06/12/2010 10:00:50
Im sure a lot of you know about the market scam where someone finds some rare item, puts up a sell order 10 or so items say 40 mil a peice. Then they put up a buy order a few jumps away for 20 ish items at 45 mil a peice. So being a trader, one thinks they can just move it and make a quick buck. Well of course the minimum volume for the buy order was more than are for sale in the Market anywhere. Recognizing this, I built enought items to fill the order along with the items already for sale on the market. I check every couple seconds to make sure the buy order is still up. When i finally go to sell the items. It says the order is no longer valid. I'm out hundreds of millions of isk. What does CCP have to say?




I lost 700M on that one as well. I went into it with the full knowledge that it was a scam. What I didn't realize was that it was a bot. And no matter how fast a human can click 'sell', a bot can click 'cancel order' faster.

Lesson learned.



Nothing to do with a bot.

The scam is based on the use of the Margin trading skill and a empty wallet.

The scammer train Margin trading to 5, put a buy order for 100.0000.000 paying up front only 24 millions (approximately). He is supposed to pay the other 76 millions when the order is fulfilled but he empties his wallet so the isk are not available.
When the order is fulfilled the system delete it as the buyer hasn't the money to pay.




Thanks for that.

Now the lesson is learned properly.

Clever use of game mechanics, I suppose. But I think it may need to be reworked sometime in the near future, as you did just give the general population a step by step workshop in how to run a foolproof scam. I'm guessing it will become even more prevalent in the days to come.

Mehrune Khan
Amarr
Posted - 2011.02.01 18:44:00 - [97]
 

Listen I'm not a trader, but I'm pretty sure that when you place a buy order for something, the money you offer immediately leaves your wallet and gets stored somewhere in the system. The only way to get your money back is to cancel the buy order. As long as that order exists, any seller has the right to fulfill that order, and receive the money you offered.

So if the OP tried to fulfill the order, and couldn't, it seems to me that there is an exploit that allows someone to manipulate the money they offer into the system when they create a buy order. Since that data would be stored on CCP's servers I can imagine it's a pretty serious exploit.

Why would anyone even try defending this, unless they were exploiting it themselves?

You What
Smokers' Heaven
Posted - 2011.02.01 18:48:00 - [98]
 

Edited by: You What on 01/02/2011 18:49:24
Originally by: Mehrune Khan
Listen I'm not a trader, but I'm pretty sure that when you place a buy order for something, the money you offer immediately leaves your wallet and gets stored somewhere in the system. The only way to get your money back is to cancel the buy order. As long as that order exists, any seller has the right to fulfill that order, and receive the money you offered.

So if the OP tried to fulfill the order, and couldn't, it seems to me that there is an exploit that allows someone to manipulate the money they offer into the system when they create a buy order. Since that data would be stored on CCP's servers I can imagine it's a pretty serious exploit.

Why would anyone even try defending this, unless they were exploiting it themselves?


lol

Check out the first page of this thread. Especially post #15

Frau Klaps
Amarr
Posted - 2011.02.01 18:52:00 - [99]
 

RL Antiques trade works the same, imply value to buyer, profit.

DO NOT BUY STUFF WITHOUT UNDERSTANDING ITS TRUE VALUE, otherwise you probably just got scammed. Legit traders complaining about this ought to have more smarts.


Mehrune Khan
Amarr
Posted - 2011.02.01 18:55:00 - [100]
 


"Theres your problem there. The minimum volume is there for a reason.

Margin Trading skill
L0 = 100% escrow
L1 = 75% escrow
L2 = 56.25% escrow
L3 = 42.18% escrow
L4 = 31.64% escrow
L5 = 23.73% escrow

The scam will work if minimum volume price > 23.73% of the total escrow value for someone with max Margin Trading skill.

Simple example :

Buying 10x Pax Amarria@10mil
The escrow for the buy order = 100 * 0.2373 = 23.73mil
In order to ensure the above buy order fails, minimum volume = 3 (which requires 30mil in escrow)

It goes without saying that the scammer will also need to ensure that the wallet he used to set up the buy order has zero isk in it."

I have no idea what this means. But I'll assume you are all fantastic bureaucrats and are ripping people off with in-game mechanics, rather than hacking the CCP servers. Which is fine.

You What
Smokers' Heaven
Posted - 2011.02.01 18:59:00 - [101]
 

Originally by: Mehrune Khan

I have no idea what this means. But I'll assume you are all fantastic bureaucrats and are ripping people off with in-game mechanics, rather than hacking the CCP servers. Which is fine.


It's a Margin Trading skill which let's you set up a buy order without having the whole sum needed to cover the order.

Decarus
Amarr
Apostlecorp inc.
Posted - 2011.02.01 19:07:00 - [102]
 

Y'all are posting in a necro-thread.
Please switch breathing to manual.

Mr Ignitious
Aperture Harmonics
K162
Posted - 2011.02.01 19:36:00 - [103]
 

Originally by: LindaSpartan 058
I know, and I'm not camplaining that scamming exists, or that they arent punished. But How is it they consider that an intended feature. Theres no way to tell if an order is fake.



Lol you don't even know about freeform contracts.

Tippia
Caldari
Sunshine and Lollipops
Posted - 2011.02.01 20:22:00 - [104]
 

Originally by: stoicfaux
That's just weak, especially coming from you, Tippia. Yes, there was no loss of meaningful isk in this case. However, there was a serious loss in opportunity costs and intangibles:

* time
* resources - in this case the materials used to create the rigs were probably worth more than the rigs.
* trust - anything that erodes trust in the market erodes the market.
* isk - there was a trivial isk loss in manufacturing fees
…all of which comes back to the notion that the seller didn't make his research. He could have fallen in the exact same trap even if the buy order was legit — if he spent the time and the resources, and was then too slow. Same result: he ****ed up because he didn't have a plan B if at the end the order was no longer available. He failed at the very basic of investment analysis. He gambled and lost.

It doesn't particularly matter if he bought from the market (thus falling for the scam) or if he manufactured his own stuff. Either way, he didn't actually do any research about what kind of return he could expect. No, "oh, there is one order for the stuff" does not count.

Frau Klaps summed it up perfectly:
Originally by: Frau Klaps
RL Antiques trade works the same, imply value to buyer, profit.

DO NOT BUY STUFF WITHOUT UNDERSTANDING ITS TRUE VALUE, otherwise you probably just got scammed. Legit traders complaining about this ought to have more smarts.
The margin trading mechanic protects both buyer and seller. What makes people fall for this scam is a complete failure to analyse the market, not the mechanic. It's the same thing that will make them fall for other scams, which do not rely on this particular mechanic.

stoicfaux
Gallente
Posted - 2011.02.01 20:54:00 - [105]
 

Originally by: Tippia
…all of which comes back to the notion that the seller didn't make his research. He could have fallen in the exact same trap even if the buy order was legit — if he spent the time and the resources, and was then too slow.


The seller did do their research. The seller tried to avoid tipping off the scammer by manufacturing the rigs himself instead of buying from a nearby inflated sell order.

The problem is that there was never any chance for the seller to win. The whole point and motivation behind a free market is the opportunity to make a profit. In the case of the auto-canceling buy order, there's *zero* chance of making a profit.

Therefore, the seller had no protection whatsoever.


Quote:
Same result: he ****ed up because he didn't have a plan B if at the end the order was no longer available. He failed at the very basic of investment analysis. He gambled and lost.


It was NOT a gamble. The game was fixed.

The seller gambled on being able to manufacture the rigs and fill the buy order before anyone else did. The seller gambled on no-one buying the inflated sell order thereby tipping off the scammer to manually cancel the buy order. The seller was aware of the risks.

The seller did due diligence, weighed the odds and decided to take the gamble. They then were screwed by a game mechanic, because the seller didn't gamble on there being absolutely, positively no way to fulfill the sell order.

Completely eliminating any chance for profit by design is anathema to a free market. It is philosophically and fundamentally BAD.



Verkehr
Posted - 2011.02.01 21:43:00 - [106]
 

Fairly simple fix, auto-delete buy orders that can't be fulfilled by the issuer's wallet.

Barkaial Starfinder
Minmatar
The Kairos Syndicate
Transmission Lost
Posted - 2011.02.01 22:02:00 - [107]
 

I heart EVE

Tippia
Caldari
Sunshine and Lollipops
Posted - 2011.02.01 22:03:00 - [108]
 

Originally by: stoicfaux
The seller did do their research. The seller tried to avoid tipping off the scammer by manufacturing the rigs himself instead of buying from a nearby inflated sell order.
The seller did not do his research. Again, it could just as well have been a legit order and he was too late, which would have yielded the same result: wasted time and resources. He didn't have an strategy to recoup those costs.
Quote:
The problem is that there was never any chance for the seller to win.
There is also no chance for him to lose. Well, beyond if he doesn't do his research and make stupid gambles, in which case he should fall for his own folly and eat the loss he decided to generate for himself.
Quote:
It was NOT a gamble. The game was fixed.
In this case, maybe. That doesn't make it any less of a gamble. The exact same result could have been had with a legit order.
Quote:
The seller was aware of the risks.
If he was (i.e. if he had spotted the obvious scam), he wouldn't have made the choice he did.
Quote:
Completely eliminating any chance for profit by design is anathema to a free market.
Good thing that this isn't happening here, then. The chance for profit is still there: steal the scam. You do your research, you spot the scam, you a) choose not to be stupid and make bank, or b) put your own wares as a sell order that compete with the scammer's to get the marks the scammer is going for.

What eliminated the "chance for profit" is the complete lack of risk analysis on the seller's part. He screwed himself over. The mechanic itself actually does the exact opposite: it eliminates the chance for loss. But I suppose that could be bad as well…

NewReality
Hegemony of Eve Industries
Posted - 2011.02.01 22:40:00 - [109]
 

Originally by: LindaSpartan 058
Edited by: LindaSpartan 058 on 06/12/2010 10:00:50
I end up with 23 uselss items because of a glitch.




You could always set up your own scam.

I bought a useless bookmark for 100 Million once... That was the moment I fell in love with eve.

Myra2007
Millstone Industries
Posted - 2011.02.01 23:42:00 - [110]
 

Edited by: Myra2007 on 01/02/2011 23:42:24
Originally by: LindaSpartan 058
Unlike most scams where if your careful you'll catch it, there is no way for a player to know that an order is fake.



Half your post explained in detail how you knew it was a scam. Does not compute. You knew it was fishy but you thought you could outsmart the guy.

In general if you keep to the tried and tested "buy low and sell high" these orders are no danger to you. When you build or buy stuff to fill a buyorder always make sure that you can at least sell it without a loss again. That's only reasonable given that there would be no way to 100% ensure that the order is still there when you got the stuff. Would you also complain if the order had been valid but someone else filled it before you? I guess not but the actual result is the same both ways.

Originally by: LindaSpartan 058

And also please explain to me how this can not be considered an exploit.



An exploit is what the GM's/devs decide to label as one. Simple as that really.

Originally by: LindaSpartan 058

If someone trains margin training, and doesn't have enough isk to cover the order, shouldn't the order expire, have a warning of some kind, or at the very least, make the scammers wallet go into the negative?


What purpose would margin trading have then? The idea is that you're able to "overextend" your buyorders to make more of them at the same time while you don't have all the funds ready. It's a legitimate tool used by pretty much every trader.

THERisingPHOENIX
Caldari
Posted - 2011.02.01 23:49:00 - [111]
 

To me, its easy to spot the margin traders anyway and avoid them. Always look carefully at the market.

Th0rG0d
Terminal Pharmaceuticals Inc.
Posted - 2011.02.02 00:00:00 - [112]
 

LOL... at first glance this seems messed up, but in reality, I don't get how anyone could say this is a scam, much less an "exploit".

You don't lose any isk, your items don't get stolen, you aren't even lied to. What you did was bought "worthless" items without doing any research. If a deal seems too good to be true, then it is. Didn't your daddy teach you that when you were little? Rolling Eyes

Venkul Mul
Gallente
Posted - 2011.02.02 00:33:00 - [113]
 

Originally by: Muna Kea


Thanks for that.

Now the lesson is learned properly.

Clever use of game mechanics, I suppose. But I think it may need to be reworked sometime in the near future, as you did just give the general population a step by step workshop in how to run a foolproof scam. I'm guessing it will become even more prevalent in the days to come.


It was already explained in this thread and countless other threads.

The limit is people willingness to train to use it and finding the use as "bait".
As preparing it require both the willingness to scam and some work with a spreadsheet there is a limited pool of players willing to do it.





Ai Shun
Caldari
Posted - 2011.02.02 03:06:00 - [114]
 

Edited by: Ai Shun on 02/02/2011 03:08:38
Originally by: Adrian Steel
The problem with current game mechanics is that the market does not provide the transparency that real-world markets enforce: you cannot tell if that outrageous bid's issuer is insolvent or not until you hold the goods required to actively transact against it.


The key word for me is "outrageous". As EVELopedia says under it's section on scams: "If it sounds too good to be true, it probably is"

This Margin Trading scam smacks of a certain prince's widow somewhere in the depths of Africa, desperate to have her funds transferred to a save haven before some dastardly despot uses it to further clench his militaristic fist on the country ...

If you see a sell order for 90,000,000 ISK for an item you know is worth 9,000,000 what are you going to do? Put your items up for 89,000,000 ISK? Or closer to the actual value of the items? In the same way, if a Buy Order is terribly out of tune with the real market value and a greedy trader zooms in to try and capitalise on it; well ...

They've just donated to the EVE equivalent of a 419 trying to take advantage of somebody else and have instead found themselves at the blunt end of the stick.

EDIT: I do like the idea of needing some form of security for an order, even if you only need a minimal amount upfront. A security pledge in terms of assets would work, I think.

Herzog Wolfhammer
Gallente
Sigma Special Tactics Group
Posted - 2011.02.02 03:12:00 - [115]
 

This complicated buy-sell-trade-margin crap is the reason why I have given away more sleeper and exploration loot than ever sold.

Too complicated.

ooga booga




Zhou Wuwang
Federal Laboratories
Posted - 2011.02.02 03:58:00 - [116]
 

The posts became a jumble for the last couple of pages, but for those of you making rational arguments about margin trading (like in the real world) there is an absolutely good reason CCP will not implement negative balances and real margin mechanics. The lender (i.e. the system) would essentially be creating isk.

For example, imagine I create a buy order on margin and don't have the money to pay. Since I don't have the money to pay, the system pays the seller, but puts my wallet balance into a negative 10M isk. Well that means 10M new isk were created in EVE that were transferred to the buyer. Aside from the simple exploit of using an ALT account to buy against your margin seller account, a real lending system such as that would put enormous inflationary pressure on the eve marketplace. Real economists attempt to control inflation (or deflation) by manipulating a number of factors that don't exist in eve. Using a real world-like lending system isn't practical here.

As it stands now, while you can setup a buy order without all the isk on hand, you can't actually execute the buy without the isk already created. That's the key to stabilizing the system.



Ai Shun
Caldari
Posted - 2011.02.02 04:01:00 - [117]
 

Originally by: Zhou Wuwang
The lender (i.e. the system) would essentially be creating isk.


My thoughts:

1. Have a system that requires you to guarantee a buy order with assets when using Margin Trading. You can put it up, but if you can't fulfill it your assets are taken and the funds paid. Would that reduce that?

2. Allow for storage of a characters buy/sell order history. E.g. Show Info should show the # Buy Orders completed, defaulted, etc. That leaves it to the other traders to inspect and practice a bit of diligence before leaping on a too good to be true deal. And allows for full use of the skill.

Ris Dnalor
Minmatar
Fleet of Doom
Posted - 2011.02.02 04:03:00 - [118]
 

Edited by: Ris Dnalor on 02/02/2011 04:05:19
Originally by: Adrian Steel


Your argument fails on the most fundamental of intellectual levels.

In order to have a neutral gaming/market environment, risk is a requirement for BOTH parties of a player-versus-player encounter. In this case, there is no risk for the issuer of the fake bid because his only downside is the large broker fee which is known beforehand. Risk is an element of unknown future circumstances. The fake bid issuer already knows all possible variables which may affect the future while the counter-party does not. To put it in terms which you can understand - Sesame Street would call this u-n-f-a-i-r.


Eve is harsh. Eve rewards those who would take advantage of others. You don't have to like it, but it's been that way for nigh 8 years now, and i would bet my wallet it'll be that way 8 years from now.

I cede the point that scammers face little or no risk. However, I would point out that this is Working-As-Intended... AND just like the other low-risk ways of making isk, ( like mining Veldspar in 1.0 space, for example ), it's a horrible grind. Why? Well, Adrian, because most people don't get scammed "the second time", so the number of potential victims that have something worth scamming is limited... So to pull off a successful scam takes time, patience, and repetition... much like mining veldspar in 1.0 space, or doing agent missions in high-sec, or doing PI... you get the idea.

The difference here is the scammer takes isk from another players wallet, instead of the isk being generated out of thin air by the npc's.

Some people think this is wrong, because a small mistake can cost a player hours, days, weeks or sometimes months of work.

I am on the other side of the fence, and say this is what makes eve great.

I remember back in 2003, when I scrounged and saved for my first battleship. I bought the second one to roll off the production line. I could barely fly it. In fact, I put frigate-sized guns on it at first, simply because I didn't have the skills to use anything larger. I bought some skills, and some bigger guns to put on it later, some ammo, etc, and decided I'd just fly up real quick to a low sec system where I could learn to fly it better and finish training up my skills.

Just a few jumps into low sec I lost my shiny new battleship ( that wasn't insured ) and I learned a harsh, very expensive lesson, due to my unpreparedness for what was really awaiting me. I see absolutely zero difference between what happened to me and what happens to someone when they get scammed.

Eve is a MMO. If people interacted with others, and learned the game, and were cautious, and realized that anything that sounded too good to be true, probably was... then they would rarely get scammed. But that fact is that people don't. They get in a hurry. They get greedy. They mess up. They make the mistake of thinking they can learn to play eve solo... Eve punishes these things, especially the latter. I applaud CCP for doing it. Even when they do it to me... sometimes I am upset in-the-moment when I lose a pile of isk, but at the end of the day, it's this harshness that keeps me coming back.

You can talk about fair-play, and fairness, and lack of risk, and real-world blah-diggetys, all you like. But the fact of the matter is simple.

Someone fell for a scam. Their pride is wounded, their wallet is wounded, or perhaps their sense of justice is offended. Someone else on the other hand, is a bit richer. That's what makes eve go round & round. Some folks like it and play eve for years. Other folks don't like it and go back to wow.

You're free to choose your own destiny in eve, just like it says in the trailer Razz




Zhou Wuwang
Federal Laboratories
Posted - 2011.02.02 04:15:00 - [119]
 

Edited by: Zhou Wuwang on 02/02/2011 04:18:34
Originally by: Zhou Wuwang
The lender (i.e. the system) would essentially be creating isk.

Originally by: Ai Shun

My thoughts:

1. Have a system that requires you to guarantee a buy order with assets when using Margin Trading. You can put it up, but if you can't fulfill it your assets are taken and the funds paid. Would that reduce that?


As many have noticed the value of assets in eve are not fixed. It wouldn't surffice even with such complicated mechanics. Of course to dissuade folks from making buy orders on margin that they can't cover is quite simple. The system keeps the escrow on a failed buy and then closes the order -- in other words, you don't get that 23% (etc.) isk returned on a failed buy order.

Originally by: Ai Shun
2. Allow for storage of a characters buy/sell order history. E.g. Show Info should show the # Buy Orders completed, defaulted, etc. That leaves it to the other traders to inspect and practice a bit of diligence before leaping on a too good to be true deal. And allows for full use of the skill.


As others have written here already, if you can't judge the relative value of an eve item, you probably ought to be doing something other than trading as a career. Risk is something that miners, mission runners, ratters, and pvp gladiators face everyday as well in eve. Like the trader, they survive and prosper more on their wits than on the system.


Musashi IV
Posted - 2011.02.02 04:49:00 - [120]
 

Greed will get you everytime. If its to good to be true in EVE you know its a scam.


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