2. Fraud in the Virtual World Tim Sparrow, Consultant, Client and Technical Services

3. Summary Virtual Services  The MMO virtual marketplace Fraud  What is MMO fraud?  What impact does it have?  Why is it attractive to fraudsters?  What does the future hold?

4. Virtual Services Selling the Goods…  Gold  Lord of the Rings Online 1.0 gold  Age of Conan 1.3 gold  World of Warcraft 100 gold  Eve Online 24 million gold  Items  Levelling (£180+ for max level)  Characters (€7,000 current record)  Property (Anshe Chung $1 million)

5. MMO Fraud “The use of deception with the intention of obtaining an advantage, avoiding an obligation or causing loss to another party.”  Direct fraud vs. “friendly” fraud  Hacked accounts  Vulnerabilities and exploits

6. Fraud Impact Direct  Financial losses – cost of providing service, administration costs, chargeback costs etc.  Remedial costs – Fixing exploits, changing gameplay rules, fraud screening Indirect  Reputation losses  Game economics  Disadvantage to being honest

7. What Attracts Fraudsters? Money!  Virtual assets have a monetary value  Low risk – Governance little to none, no physical goods trail  Fast and easy compared to conventional online fraud  Difficult for providers to stop repeat offenders  International access

8. The Future of Fraud…  Techniques get increasingly complex and advanced  Fraudsters are becoming more organised  As MMO virtual worlds advance, so do the rewards from fraud  Stronger, more advanced fraud screening techniques must be employed by MMO virtual world providers  Geo-location checks, IP checks, device fingerprinting, velocity checks, identity morphing and other custom business rules  Education and training

9. The Future of Fraud… cont’d Fraud is affecting all providers  MMO RPG  MMO virtual world  Gold/Item providers  Guide providers But most of all…  The virtual community

10. For More Information  Speak to me Tim Sparrow Call: +44 (0)7884 431 472 Email: tsparrow@cybersource.com  Contact CyberSource Call: +44 (0)118 929 4840 Email: uk@cybersource.com www.cybersource.co.uk