letter to editor of salon.com regarding http://www.salon.com/tech/feature/2001/02/23/pay_pal/index.html _____________________ Peter Thiel, according to today's salon.com article (correctly) describing the repudiable nature of PayPal payments, apparently regards it as appropriate to make reckless allegations that depict e-gold(r) http://www.e-gold.com as some sort of system to "launder funds". This (probably actionable) remark is especially ironic given the multiple attempts that Gold & Silver Reserve, Inc. and other companies have made to help PayPal address PayPal's severe fraud problems. Gold & Silver Reserve, Inc. was the original developer and operator of the e-gold system. It now functions as the primary distributor of e-gold with its OmniPay service http://www.omnipay.net , a system of online exchange that functions as a hybrid payment system in its own right. OmniPay, by the way, accepts national currency payments only by wire transfer (subject to a $3000 minimum) because wire is the only non-repudiable method for receiving payments that involve the banking system. The first time we heard of x.com and PayPal was around November 1999 when our fraud detection protocols were triggered by a series of suspicious wires from x.com. We contacted Kathy "I guess I'M the fraud manager!" Donovan and informed her of our suspicions. x.com (shortly afterward merged with PayPal) never was able in that episode to even reconstruct how funds had been taken from their bank account. We actually had to explain to them that available funds and good funds are not synonymous and that their practice of ACH debit for funding accounts was an invitation for fraudsters. They mentioned to our amazement that they did not even capture IP numbers with the online application they were using at the time. Since then we have detected and thwarted multiple episodes of would-be crooks who, having already taken PayPal to the cleaners, attempted to rip off our company or companies we do business with. In several incidents we have offered to help PayPal identify and prosecute obvious crooks but the attitude of their responses (like many banks) was that they would rather cover up the fact that they are being inundated by fraud rather than risk loss of investor confidence. Like so many dotcoms they seem to be in the business of raising money from investors, as opposed to earning profits (the former they have excelled at, the latter I doubt will ever occur). To set the record straight regarding what e-gold is and how ridiculous it would be to use it as a system to hide the proceeds of crime... e-gold enables people to use gold like they would money. e-gold is backed 100% by gold in allocated storage* under the signatory control of a third party escrow agent, titled to the e-gold Bullion Reserve Special Purpose Trust for the exclusive benefit of all e-gold account holders collectively. A person with an e-gold balance can click some to another account holder. These transfers settle immediately and, unlike PayPal or credit card transactions, are non-repudiable. e-gold is account based, so the entire lineage of any value stream is logged - right back to the time that value entered the e-gold universe via exchange. Sophisticated pattern matching protocols detect activities such as smurfing (attempts to structure transactions in a way to disguise large flows of value). Please note that the e-gold shopping cart interface enables automation that enables a recipient to programmatically post accounts as paid and to deliver goods and services with total confidence that payment (including micropayments) is fully and irreversibly settled. The maximum cost of receiving an e-gold payment is 50 cents (US$-equiv.). For values under $50 the fee for receiving payment is 1%. There have been over 2 million e-gold transactions** even though, unlike PayPal, e-gold never needed to give money away as an inducement to open accounts, and in fact has never done much of anything in the way of marketing/promotion. Douglas Jackson, MD Chairman, OmniPay 175 East Nasa Blvd., Suite 300 Melbourne, FL 32901 (800) 909-6590 * see http://www.e-gold.com/examiner.html ** see http://www.e-gold.com/stats.html --- You are currently subscribed to e-gold-list as: archive@jab.org To unsubscribe send a blank email to [EMAIL PROTECTED]
