...From the "non-repudiation is a bitch" department, wherein E-Gold, and
their customers, discover the joys of book-entry transaction underwriting...
When you need to know your customers -- which you *must* do with book-entry
settlement or you're out of business -- you need to *know* your customers.
That includes making sure they don't get you, as a transaction underwriting
intermediary, in trouble with the very cops who are responsible for
enforcing the non-repudiation of your own transactions.
To paraphrase a certain Mr. Callahan, a transaction system's customer needs
to know the system's limitations...
I expect, among other things, that if E-Gold survives this, and I expect
they will, that they'll be that much more, um, incented, to issue bearer
notes against a single gold reserve someday instead of acting as a bailee
for each separate customer. Or, maybe, to be a bailee for each separate
customer, as defined by posession of a specific bearer certificate.
Whatever the law will allow, of course, same as it ever was.
Cheers,
RAH
--- begin forwarded text
From: "Daniel J. Boone" <[EMAIL PROTECTED]>
To: <[EMAIL PROTECTED]>
Subject: e-gold: Frozen accounts, returned funds, a few of my favorite
things...
Date: Fri, 18 Feb 2000 20:35:27 -0900
Sender: [EMAIL PROTECTED]
This is long. I post here rarely, and intend to continue the practice. But
the startlingly rude message quoted in full below stirred me to share a few
observations.
To get right to the point, I am surprised and appalled at the idea that
e-gold accounts can and apparently have been frozen, apparently on an ad hoc
basis or pursuant to an after-the-fact policy not extant, or not advertised,
when the accounts in question were created. I may be wrong about those
apparent facts -- if so, I'd love to hear it. All I know is what I read
here on the e-gold list, and the strength of my attention does vary.
As for my surprise and distaste at this development, I don't especially
expect anyone at e-gold or its hydra-headed affiliates to care. I'm just
expressing my opinion here. However, I will make this observation: e-gold
is nothing without its credibility. In my view, talk of freezing accounts,
let alone actually doing it, is suicidal folly for a company (or set of
companies) whose stock-in-trade is secure storage of value. Freezing
accounts is something the IRS and third-world dictators do, not companies I
want to do business with.
I'm not some johnny-come-lately critic with a criminal axe to grind. I've
had an e-gold account since early 1997, which is roughly contemporaneous
with the time that Douglas Jackson made the mistake of spamming one of
Robert Hettinga's many mailing lists on financial cryptography and related
subjects. My e-gold account number is 100098. I think they started at
100000, which would put me in the first hundred customers. My account has a
little e-gold in it, but not much. My disappointment with recent
developments is greater, perhaps, because of the promise e-gold showed way
back three years ago.
Back then, let me tell you, the e-gold crew came across as a bunch of
nutzoid gold bugs with web server and a wild scheme. They weren't
cypherpunks -- not by a long shot -- but they had all the right instincts.
Douglas Jackson, at least, was PGP-enabled -- and we exchanged several very
interesting mails on the subject of privacy, security, and e-gold's
intentions in that area.
I wouldn't post those messages publicly, even if I could still find the key.
But I can say that Mr. Jackson satisfied me that e-gold had the right
attitudes about privacy and security. He rather delicately, without quite
saying as much, pointed out that the account information could be utterly
bogus, and it wouldn't matter until you wanted your gold, at which time you
could change the information to an address that worked and do an
out-exchange. He intimated, but of course was too professional to say, that
e-gold would not mind a whit. And finally, he went to great lengths to
convince me of e-gold's iron resolve that accounts would be secure and
inviolate -- gold held in them would stay there until withdrawn or stolen by
judicial process. ("Stolen" is my word, not his.)
Since then, e-gold has come a long way. It has grown by leaps and bounds,
and there have been tantilizing hints that a true digital bearer currency
based on it may be forthcoming. I've been rooting for it all the way, and
have half a dozen progeny accounts to show for my trouble.
Now comes Charles Evans, who I do not know, but who seems to have been
associated with the enterprise as long as I have known about it. (This is a
fancy way of saying I remember the name from early days.) He's signing as
executive vice president of Omnipay, which is a business name new to me. I
don't know whether it's yet another head of the e-gold hydra or what, but
I'm seeing the phrase "G&SR/Omnipay" so I will assume so.
And Evans, if he has not been the victim of a drive-by misattribution, has
some rather nasty things to say about critics of recent developments.
"Effete little cowards" "lobbing spitballs"? Well, maybe some of the
critics fit that description, but I've seen sincere, committed, enthusiastic
customers of e-gold raise criticisms too. I hate to say it, but this sort
of invective violates the first supreme rule of customer service: "Never,
ever, insult your customers." Even if you fire 'em, don't insult 'em. It
makes you look bad and drives away customers you DO want.
Here's my synopsis of the whole argument, in the smallest nutshell I could
find:
1) E-gold sez "We don't want crooks or anarchists - they make us look
bad, and might break bring down the ugly hand of government to crush us."
2) Anarchists not unlike myself, but not including myself, sez "You
weenies -- if you had any balls you'd help us smash the state!" (Plus one
or two crooks chime in with a dismayed "hey, we thought you were our buds!")
3) E-gold sez, sensibly, "Smashing the state is not in our business
plan -- we'll do as we please thank you very much."
4) Anarchists: <repeat #2 until dead>
5) Concerned customers say "Hey, waitaminute -- you just told those
bozos you would do as you please with their gold -- what does that mean for
us honest customers?
And here, friends, is where it all goes to hell. Because the answer to 5)
seems to be:
6) "Honest customers? Makes no never mind, we can do whatever we want
with your gold, but when we get around to writing a policy we'll probably
share it with you, or at least the public parts. We'll probably keep the
details secret. But don't worry, we only do this stuff to the scammers and
crooks."
Which leads inexorably to much squawking from honest customers just
discovering that e-gold isn't quite as hands-off and repudiation-proof as
they thought. Which would be the end of it, or should be. A few concerned
customers, but a good reputation and no particular cause for alarm.
But hark, what's this? Concerned customers are being described as
"emotional supporters" of "liars, thieves, and hustlers"? Being told to
"run along and find some other payment provider"?
That takes my breath away. It is, quite simply, the second or third dumbest
piece of customer relations work I have ever seen. No offense intended, but
perhaps some deserved nonetheless.
Like it or not, e-gold has created for itself a credibility problem. From
reading this list, it is clear to me that public doubt now exists, where it
did not exist before, on the crucial question of (1) whether e-gold that
lands in your account stays there until you take it out or a judge does, no
exceptions; and (2) whether you will get it out when you ask for it, again,
no exceptions. I, for one, certainly thought that e-gold had made
affirmative promises in this regard. If it did make such promises, it
appears to have breached them, and an apology and promise to sin no more
would be in order. If it never made such promises, some work is needed to
clarify exactly what promises e-gold is, in fact, making.
These are not demands; that would be laughable because e-gold is free to
tell us all to pound sand. These are public relations suggestions. I, for
one, will never hold any significant amount of e-gold until they are
followed, and I suspect I am not alone.
Thanks for listening --
Daniel J. Boone
=======================================================
The Law Office of Daniel J. Boone
704 West 11th Street
Juneau, Alaska 99801
(907) 723-9902
[EMAIL PROTECTED]
=======================================================
"No man's life, liberty, or property is safe when the
legislature is in session." -- Judge Gideon Tucker
=======================================================
----- Original Message -----
From: Charles Evans <[EMAIL PROTECTED]>
To: e-gold list <[EMAIL PROTECTED]>
Sent: Tuesday, February 15, 2000 2:39 PM
Subject: e-gold: Frozen accounts, returned funds, a few of my favorite
things...
> Edwin Woudt <[EMAIL PROTECTED]> wrote:
> >
> >Found this at one of these games forums:
> >
> >http://www.delphi.com/digistock/messages/?msg=480.1
> >
> >I'm not sure which program was frozen, but it wasn't EMutualFun or
> >DigitalStocks. I heard something about 'RIT', but I'm not sure what
> >it is.
> >
> >One of the most interesting parts is this sentence:
> >
> >> we have taken the extraordinary step of returning your funds to you.
>
> This was a one-time experiment in fraud control. Please watch this list
> for the latest word on account freezing.
>
> -------------<cut here>-------------
>
> In case you missed it, there has been some discussion concerning e-gold
> Ltd's decision to freeze some e-gold accounts. Some on this list have
> been supportive; most have been bemused; a small handful have been
> offensive and abusive.
>
> Thanks for remembering to put the dash in "e-gold."
>
> Let us take a moment to address the definitions of some terms before we
continue:
>
> There is a difference between censorship and
> a privately-owned commercial endeavor's
> decision to no longer subsidize libel waged
> against it. In the case of e-gold Ltd, which
> is a privately-owned commercial endeavor, not
> putting up with liars, thieves, and their
> emotional supporters falls into the latter
> category.
>
> Fraud is the making of promises that one has
> no intention of keeping. Deposits are funds
> that are LENT to others. The scams that
> e-gold Ltd has chased away have taken others'
> money on deposit and promised returns that
> are impossible in the absense of fraud and
> meta-fraud.
>
> Both G&SR/OmniPay and e-gold Ltd are operating on the Internet, and
> instituting policies that are designed to provide the firmest
> foundation. The Internet part of this means that all of us --
> academics, businessmen, and crooks -- are learning as we go.
>
> For our part, G&SR/OmniPay is caught in a balancing act that is not of
> our doing.
>
> On the one hand, effete little cowards who hide behind pseudonyms and
> remailers lob spitballs at us for making it harder for liars, thieves,
> and hustlers to ply their trade via *OUR* bank accounts. On the other
> hand, e-gold Ltd is developing policies that are designed to support the
> strongest financial system ever seen in human history.
>
> In this fray, we make an exchange market, day-in and day-out.
>
> Our position is this: we don't care what you use YOUR money for, so long
> as you don't put us in a position of having to take the fall for you.
>
> Rather than whining about it, and making others' life uncomfortable,
> liars, thieves, and their emotional supporters should run along and find
> some other payment provider to be their patsy.
>
> If you would like to learn how to use e-gold to have all of the privacy
> your little heart desires, be in Anguilla next week to hear me address
> exactly this question.
>
> http://fc00.ai
>
> Charles W. Evans
> Executive Vice President
> OmniPay
--- end forwarded text
-----------------
R. A. Hettinga <mailto: [EMAIL PROTECTED]>
The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'
