
Fake online stores reveal gamblers' shadow banking system - rbanffy
http://uk.reuters.com/article/uk-gambling-usa-dummies-idUKKBN19D13E
======
michaelbuckbee
This sounds somewhat similar to the polite fiction of Japanese Pachinko
parlors [1].

"Taniguchi swapped the tray of thousands of winning silver balls for a
receipt, which in turn was swappable for alcohol, toys or other prizes. To get
money, you need to ask for the “special prize” tokens. These are plastic gold-
coloured tokens that can be swapped for cash -- but not within the pachinko
parlour. Instead, they are cashed in at TUC shops that are always located
nearby and exist as a legal loophole enabling you to win money in a country
that technically forbids gambling."

1 - [http://www.bbc.com/travel/story/20120815-the-big-business-
of...](http://www.bbc.com/travel/story/20120815-the-big-business-of-japans-
pachinko-parlours)

~~~
the_cat_kittles
great travel story. it misses something that i felt in _spades_ whenever i
popped my head into a pachinko parlor: it is incredibly depressing. ive never
seen slots in vegas but i imagine its similar. theres something incredibly
reductive about sitting there watching balls bounce randomly and slowly losing
money. especially knowing that people are hopelessly addicted to it. but, i
get it. we are all capable of succumbing to things like this. the void is
utterly palpable in those places.

~~~
balabaster
Wow, I've been in about a dozen casinos in my life. I hated every minute I was
in them. I had pre-budgeted a specific amount and when it was gone, it was
gone.

I could never really place my finger on what it was I disliked about them
except that the games bored me. But it was so much more than that. I failed to
connect the dots until exactly the moment I read your comment.

There _is_ a void, an abyss of loneliness and sorrow. Many of the people there
are empty. Lost. An air of depression, desperation hangs in the air. It's like
they've lost the will to live and this is their last hope at redemption that
fades with every token they drop into the machines.

As an empath, this emptiness, this void that you describe being so palpable.
That cuts to the very core of how it makes me feel when I enter them and why I
spend the entire time longing for the door. It's like the Dementor's Kiss for
me.

Thank you! Sincerely!

~~~
csa
Take 20x the min bet (e.g., $200 to a $10 table) to a craps table, bet the
pass line, get free drinks, and cheer like crazy for the shooter.

This is a relatively low variance and no skill way to have fun at a casino.
The craps table are usually where the fun people are.

A few general comments:

\- Your expected value on a $10 bet is -$0.15. You get maybe 25-30 bets an
hour at a full table. It's a very cheap game to play.

\- Tables are active at different times in different casinos. Evenings are
often the best time. Weekends can be good, but sometimes more crowded and/or
higher minimums.

\- Stakes can matter in some casinos. The difference of clientele at a $5 min
table and a $10 min table can be noticeable. Casinos with a wider range of min
bets will also have wider range of atmospheres. Pick your poison.

\- Remember that you are responsible for your bet and collecting your winnings
(i.e., pulling it in). Dealers sometimes make mistakes, and sometimes people
grab the wrong bet (intentionally or unintentionally). This is usually not an
issue, just stay on top of it at a busy table.

\- Bring some $1 or $5 chips to tip the dealers and the cocktail waitresses.
Good tipping usually gets you better service.

~~~
balabaster
I know there are loads of people that _do_ find enjoyment in Casinos. So I
know my perspective isn't the only one by a _long_ shot.

A friend of mine used to be a professional gambler. He stuck to the poker
tables... I guess he must've played medium stakes. He did pretty well because
you're playing against the other players, so even though the house wins
overall, if you're a decent poker player, you can walk away with more than you
started every night, and he did and the house still wins. The odds work far
more favourably when you're betting against other players rather than the
house. He started off without much money in the bank, but he was pretty
quickly pulling in enough to cover his rent, bills and never seemed to want
for much.

It always seemed to me if the game itself could've held my attention longer
than 15 minutes, it would've been a pretty easy way to augment my income. The
truth is though, after 15 minutes I'm bored with that.

~~~
laumars
> _if you 're a decent poker player, you can walk away with more than you
> started every night,_

This is a huge exaggeration from what my poker playing friends have told me.
One notable individual being a professional poker player of several years and
who has wins in national tournaments as well. So he really knows his game.
We've often talked about the odds of winning and how sustainable it is as an
income. The figure he gives me is around 20% - that is you can only expect to
cash in around 20% of the competitions you enter. Which means you can often go
months without seeing a return. However it's not just him I've seen give that
figure, other players I've spoken to have echoed a similar statement.

~~~
phil21
I also know a WSOP final table player, and what you say is true of tournament
play.

Think of that more like the lottery for professional poker players. The
celebrities do that a couple times a year, and the grinders hope to make
enough for buy-in and "make it big". It's the least mathematically interesting
way to "make a living" playing poker there is.

Where you grind out your living is the daily cash games. Yes, if you are
making a living off of Poker it's basically a job. That means boring play for
little hourly money most days of your life. After a few months, I imagine this
feels more or less identical to an actual job.

I've watched "pros" grind out their day to day life, and it really doesn't
seem that compelling. Better than working fast food, but on average seems to
pay about the same and be roughly the same intellectual stimulation. 4 screens
with 6 tables on each playing video poker every day doesn't sound that great
to me.

~~~
chx
> Better than working fast food, but on average seems to pay about the same

There are quite a few people who play from places where living costs are
low(er) like Costa Rica or Mexico or, for that matter, Hungary and make --
compared to the locals -- an astonishing amount of money. Istvan Ratkai, who
wrote a few successful text adventure games in the eighties have been one of
the most well known Hungarian video poker players. He said he played about 3-4
hours a day and made 50-70% more than the minimal wage -- the full time
minimal wage, that is. He had an ordinary programmer job as well so this as a
secondary was quite a nice haul.

------
ChuckMcM
As I've mentioned before I first encountered transaction hiding in World of
Warcraft. There were 'grey'[1] items in the Auction House with a buy it now
price of 500 gold (which at the time was extreme). I could not figure out who
would buy a twill vest for 500g until it was explained that you went to a web
site, paid them some cash for gold, told them your character name, and then
put up for auction a grey item that was priced at how much gold you had
purchased. One of the vendors 'agents' would then go into the auction house
and buy it. You ended up with your gold and as far as the game was concerned
it was a straight up, if unusual, transaction between players.

[1] Item descriptions were colored, grey was "trash" and meant to be sold to
vendor for cash, "green" were somewhat nicer/rare, then "blue" for very rare,
and "purple" for epically rare, and "goldenrod" for legendary.

~~~
splonk
Around 10 years ago before the rise of bitcoin, WoW gold was the de facto
illicit currency of the internet, since there was a reasonably robust market
for it. Things like batches of stolen credit cards would routinely be bought
and sold in prices delineated in WoW gold.

According to a Blizzard employee one of my coworkers talked to, their
chargeback rates were significantly higher than even porn sites (15+%, IIRC),
to the point that it was somewhat surprising that their payment processor was
still doing business with them. It's unclear to me if those accounts were
primarily used to generate mules to facilitate these transactions, gold
farming, or something else.

~~~
wcummings
Could be that people were buying WoW gold with stolen cards and trying to
"fence" it before the chargeback.

~~~
splonk
I don't believe you could buy gold directly from Blizzard at the time.

~~~
hamstercat
Indeed you couldn't. Technically you still can't, but now you can buy a game
token with cash and then sell that to other players on the auction house for
gold.

------
deckar01
Customer support gave up the con on a phone call? I imagine with a little more
effort they could have been indistinguishable from a legitimate business.

~~~
dragonwriter
> Customer support gave up the con on a phone call?

They kind of have to, since the whole purpose of the support number seems to
be to reassure people who know they paid “MyIllegalPokerSite.com” but see a
charge on their bill from “MyTotallyLegitFabricStore.com” that the charge
corresponds to their payment to the poker site, and that they shouldn't
contest the charges as fraudulent with their card issuer.

~~~
draw_down
Yeah. This scheme makes it seem easy to issue a chargeback though, gamblers
can just tell their credit card co "I have no idea who FabricFactory.com is".
I wonder how/if they prevent gambling customers from doing that.

~~~
dragonwriter
From the article, they told the reporter that they handled virtually all
online gambling transactions; they might just accept a certain level of it and
then blacklist the customer. (They might even let a customer suggesting that
they might issue a chargeback know that that is the consequence.)

~~~
ljf
It is also very hard to withdraw money from illegal gambling sites. It can be
done, but is often a slow drawn out process, to get you as close as possible
to the date that you can't cancel. Also don't forget that these are dodgy
people who have your home address... And know you've been breaking the law -
likely with also some tax issues too on the winnings.

~~~
willstrafach
I believe they usually have a 90-day waiting period for withdrawals if you
load via credit card (instead of Western Union or BTC), helping them ensure
the user does not perform a chargeback.

------
downandout
I noticed one of these payment processing fronts when I looked at my card
transactions after making a PartyPoker deposit back in ~2006. In this case, it
was a site called Gygon.com. If you visited their website, you would have
thought it was an online lamp store with many broken features. I later learned
that GYGON stood for "get your game on".

------
djhworld
I feel really stupid, can someone explain to me what people are allegedly
doing here?

My understanding is a Poker company (for example) puts all transactions from
US customers through these fake stores. Then the organisation running the fake
stores reimburses the Poker company outside of the US and takes a small slice
for the service?

~~~
mongmong
I would think this is primarily to hide gambling activities so it doesn't
affect your credit score. If you're applying for a loan or credit card your
bank statements can be assessed and if it finds transactions to known gambling
sites or ATM withdrawals from known gambling venues or hotels then that will
affect your credit rating badly.

~~~
querulous
[https://en.m.wikipedia.org/wiki/Unlawful_Internet_Gambling_E...](https://en.m.wikipedia.org/wiki/Unlawful_Internet_Gambling_Enforcement_Act_of_2006)

------
MrFoof
PBS Frontline covered this in their February 9th, 2016 episode, "The Fantasy
Sports Gamble" ([http://www.pbs.org/wgbh/frontline/film/fantasy-sports-
gamble...](http://www.pbs.org/wgbh/frontline/film/fantasy-sports-gamble/))

Zip to around 18:15 in the video.

 _" After I set up the account, I couldn't quite figure out how to deposit
money. That's when I got a phone call on my cell phone and a guy walked me
through how to put money on the book. Took my credit card right over the
phone. Then he assured me there wouldn't be anything on my credit card
statement that said BetOnline."_

What would show up on the statement was MoserSafety. Which was a front
website. If you called the contact information, they confirmed they had no
safety goggles, gloves, hard hats, etc. to actually sell you. It was a shell.
In fact, they confirmed on the phone that the number called was a, _" third
party payment processing support service."_ Some time later, the site no
longer existed.

------
weego
Only about a decade behind on covering this.

------
sofaofthedamned
Some usenet indexers and pay-for-join torrent sites use similar fronts to be
able to accept PayPal.

~~~
kchoudhu
They usually ship you the item. You can pay extra to not receive it, which
always struck me as odd...

~~~
peterlk
If you're using a stolen credit card or fake address or whatever and you don't
want to create any waves, not shipping the item is a value-add.

~~~
willstrafach
If you're using a stolen credit card, the cardholder will definitely issue a
chargeback.

~~~
CamperBob2
And then people wonder why PayPal is such a pain in the ass to do business
with...

~~~
jeltz
And this is why everyone should start requiring 3D Secure. On sites with 3D
Secure support I need to use an app to authorize transactions, so if this was
the norm online credit card fraud would be a much smaller problem.

~~~
joshmn
3DS is mostly a joke for anyone who _really_ wants to use your credit card. I
won't go into details publicly, but I will say that having an app to authorize
transactions is a step-up from the good 'ol "enter your PIN"

~~~
jeltz
If all physical stores required chip and PIN and all online stores required 3D
Secures then my credit card number, expiry date, and CVV would no longer be
sensitive information meaning someone would need to either steal my physical
credit card and my PIN or the secret key stored in my phone plus the PIN for
the app. This means I would not need to worry about websites stealing my card
info.

~~~
joshmn
3DS doesn't process your card, it simply validates a transaction.

------
blowski
The linked article is also very interesting

[http://uk.reuters.com/article/uk-britain-consett-
companies-s...](http://uk.reuters.com/article/uk-britain-consett-companies-
specialrepo-idUKKBN13I144)

------
e40
Still online:
[https://www.myfabricfactory.com/index.php](https://www.myfabricfactory.com/index.php)

------
johnnyg
I'm shocked, shocked to find that gambling is going on in here. Do we need
enforcement here or do we need to change policy?

------
joshschreuder
This is quite common with torrent site donations too, where you are directed
to a webstore selling 'merch' that is actually your donation to the site in
question.

------
ajmarsh
Nice, maybe I can start playing online poker again here in the US. Just have
to figure out a way to send me my winnings that are not bolts of fabric.

~~~
lazerpants
Just use cryptocurrency. Or VPN into a state that allows it.

~~~
ljf
New Jersey (at least) doesn't just rely on ip now, and need a companion app or
similar.

~~~
lazerpants
Oh wow, I just looked it up and yes, they use a shockingly sophisticated
system for this now [0]. I suspect you could still defeat it, but crypto is
absolutely the easier option.

Funny though, my friends who use Draft Kings were able to just VPN into NJ
from NY to use it.

[0] [https://www.dailydot.com/business/new-jersey-online-
gambling...](https://www.dailydot.com/business/new-jersey-online-gambling-
fence-new-york-manhattan/)

------
benologist
How could a platform detect this kind of "transaction laundering"?

------
pdelbarba
"Reuters examination has found" => we called the help desk and they said "yea,
we don't sell anything, we're a front you dummy"

~~~
dmurray
It's a weakness in the system, because the help desk employees have to be
trained to tell people "yes I know it says MyFabricFactory on your credit card
bill, but that was actually your deposit to our gambling website" because they
get that call all the time and they need to be able to put the customers at
ease rather than have them call Visa to dispute the transaction.

------
strathmeyer
Ok who here hasn't ordered "something" from Europe that showed up on your
credit card to some ecommerce site selling overpriced ipods? Let this be a
lesson to you kids, try anything unscrupulous and the feds will catch up to
you in a couple of decades.

~~~
dsfyu404ed
I ordered a pump typically used in dialysis machines for a project that
happened to require a pump of that nature. It came from some former Soviet
republic and had been opened and examined by customs in a handful of countries
(as evidenced by layers of cut tape and identifying tape and stickers placed
on it when it was deemed passable). I wonder if after the first customs
official inspected it all the subsequent countries decided if it was good
enough to be of interest to the prior country they had better open it up and
take a look as well.

I'm not sure if stuff like that is highly regulated but I was able to just buy
it on eBay and it got to me no problem so it was pretty painless.

Based on purchases a friend of mine alleges one of his friends had made the
really shady "somethings" go through .onion sites using bitcoin.

