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Margin Trading Scams and Proposed Fixes
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Jint Hikaru
OffWorld Exploration Inc
#81 - 2013-10-08 08:42:01 UTC  |  Edited by: Jint Hikaru
Now this thread has a lot of LOL in it, but the following is filled with so much fail......

William Bradley wrote:
Since practically none of you are posting anything constructive on the matter and are merely regurgitating the same "I want to be able to cheat anyone I please; it's not my fault, it's their fault" scumbag rhetoric as always, I'm not going to be bothering to respond to such vapid posts beyond this point. There is no logical or reasonable argument being presented from any of you for why the margin trading system should not be fixed; your only obvious interest is in keeping the system as it is so that you can continue to exploit other players for your own sick amusement. That EVE Online is a game is no excuse for you to treat the real Human beings on the other end of each character as inanimate objects for you to use and abuse at your leisure; such an attitude is deplorable, and speaks to your lack of integrity in the real world.

I sincerely hope CCP does do something to fix the margin trading system, if for nothing else to protect the undeserving victims of such scams from the greed and bile of sociopaths like you.



While I agree that the margin trading skill can be (lets say) 'miss-used', It does have its uses. Also its easy to view the market history on items and spot the scams.

Jint Hikaru - Miner / Salvager / Explorer / SpaceBum In the beginning the Universe was created. This has made a lot of people very angry and been widely regarded as a bad move.
Kara Trix
Deep Core Mining Inc.
Caldari State
#82 - 2013-10-08 13:06:42 UTC
I was wondering why those orders happened, mostly in Jita.
I have on a number of occasions fell for that trick...... yes, I admit it.... I'm greedy.

I think you just gave a lot of new players the idea to do it though...
Careby
#83 - 2013-10-08 14:04:49 UTC
The margin trading skill is fine.
In-game fraud is fine.
Capitalizing on the greed of other players is fine.

What is not fine is flawed market information. Market information should be 100% reliable at the time it is displayed. If an order cannot possible execute, it should not be visible in the market screens.

If I have one million in available funds, and ten different one-million-isk buy orders, there is no problem showing my orders, because any one of those orders can be filled. But if I have one million in available funds, and a ten-million isk buy order, that order should not be visible in the market because it cannot possibly be filled. Showing the order only reduces the accuracy of the available information and undermines confidence in the market.

I don't see any need to cancel buy orders which are under-funded, just don't show them until the buyer has enough funds to cover them. If the buy order is for a multiple quantity, show the actual quantity that can be covered at the time the order is displayed.
Lena Lazair
Ministry of War
Amarr Empire
#84 - 2013-10-08 14:08:31 UTC
The best possible solution to this was already proposed in another thread somewhere.

The only reason Margin Trading works in the real world is because there is some real-world risk and consequence associated with abusing/misusing it. Time/skill training is the only meaningful risk/punishment in EVE. Ergo, make Margin Trading a "T3" skill; failed margin orders knock a level off your Margin Trading skill.

There, problem solved. Legitimate users of Margin Trading should almost never fail an order (unless they are being too aggressive in which case, slap on wrist, lesson learned). They would be practically unaffected.

Scammers can still scam, only now they'll have to dedicate a bit of account training time once in a while to keep it going indefinitely. A bit of consequence to abusing the Margin Trading mechanic and an ongoing investment required on the part of the scammer.

Everybody wins.
Decian Falx
The Scope
Gallente Federation
#85 - 2013-10-08 22:45:32 UTC
RubyPorto wrote:
Decian Falx wrote:
You return to Dodixie, manually set the sell price to 24m each (minimum required in escrow w/ margin trading 5, at buy price of 100m). You press sell, the escrow alone covers the 24m*5=120m.

If you try this currently, the order fails anyway: It *seems* to check whether the scammer has the full offered amount rather than the amount asked.


It does work like that. But you're not the first to think of that trick.

Buy order for 10, minimum 5, 100m/unit. Total order is 1b, escrow is 240m.
Sell 5 to the order at 48m/unit. Total order is now 500m, escrow is now 0 ISK.

Now start spamming your 80m/unit sales contract.



I was not aware of this, however I don't see how that's really a problem:
Selling at 48m per unit should only use up the escrow for the units sold: selling at double the escrow value should draw half the funds from escrow and half from wallet. Escrow goes away first but on a per unit basis.

Worded another way, if I have a 5 unit buy order left, my minimum escrow is still 24% of the price of those 5 units. The remainder is due on sale or the order fails.
RubyPorto
RubysRhymes
#86 - 2013-10-08 22:50:23 UTC
Decian Falx wrote:
I was not aware of this, however I don't see how that's really a problem:
Selling at 48m per unit should only use up the escrow for the units sold: selling at double the escrow value should draw half the funds from escrow and half from wallet. Escrow goes away first but on a per unit basis.

Worded another way, if I have a 5 unit buy order left, my minimum escrow is still 24% of the price of those 5 units. The remainder is due on sale or the order fails.


That's not how EVE's Escrow works. Escrow is a pool, not spread over each item, nor each order, simply per character/wallet. And they aren't selling to the order at double the escrow amount, they're selling 5 units at the full escrow amount (240m).

Moreover, changing it to work the way you suggest would do horrible things to the vast majority of traders who use the Margin Trade skill to allow them to compete in larger and slower markets without an unlimited bankroll.

"It's easy to speak for the silent majority. They rarely object to what you put into their mouths." -Abrazzar "the risk of having your day ruined by other people is the cornerstone with which EVE was built" -CCP Solomon
James Akachi
Perkone
Caldari State
#87 - 2013-10-09 00:46:59 UTC  |  Edited by: James Akachi
The OP is obviously trolling or being naive at this point but I'd like to expand on something other people have touched on.

While it's an excellent scam, it relies upon something no other scam utilizes. The perceived integrity of the in-game market.

Let's take a ISK doubling scam. In order to fall for this scam you need to place your trust in some official looking wallet API site which for new players isn't so farfetched. But it's still easy to see the website is not affiliated with CCP. You don't get an in-game window indicating that the character is delivering their promises.

Contract scams. This simply relies on people not actually reading the contract and assume the title or local spam is accurate. The in-game description of the contract is completely accurate 100% of the time, as anyone would expect from a central game system.

But with the margin-trading scam your trust is breached not by a player. Not by an external website. But by the market itself which says that another player will buy an item off of you for the specified price. There is absolutely no reason for a player to consider the game's own market is lying to them.

When someone falls prey to this scam they aren't going to direct rage at the previously anonymous perpetrator. They are going to feel betrayed by the game's own mechanics. I don't really think this is the kind of scam CCP wants.

I've seen two solutions I would consider acceptable. Show the percentage of the buy order in escrow, so it's at least remotely noticeable to a player that the buy order is not a guarantee. Or delist/reduce buy orders when the potential buyer no longer has the funds. Anything else is either overly punitive to those actually trying to use the margin trading skill legitimately, or does not solve the problem of the market system itself being untruthful.

I hope that even those who enjoy the harsh realities of Eve can see this is an unacceptable situation, for reasons that have nothing to do with the actual scam, but with the apparent veracity of the market.
Reaver Glitterstim
The Scope
Gallente Federation
#88 - 2013-10-09 01:30:46 UTC
I think there should be a message somewhere that reminds people that orders don't necessarily complete. If there is, then ignore me.

FT Diomedes: "Reaver, sometimes I wonder what you are thinking when you sit down to post."

Frostys Virpio: "We have to give it to him that he does put more effort than the vast majority in his idea but damn does it sometime come out of nowhere."
TheMercenaryKing
Collapsed Out
Pandemic Legion
#89 - 2013-10-09 13:31:19 UTC
So if i understand this scam it is like the contract and buy order scam where a minimum amount of x item (not sold on the market) is needed and the contract offers x items - 1. The person attempts to sell the items he/she bought on the contract and fails for minimum items requires. In this case its not the minimum items, its the amount of isk the buyer has.

Dude, if an offer looks too good to be true, it is. Why would someone make a contract for an item and then compare it to the market when they would get more isk by selling on the market buy orders?
Alvatore DiMarco
Capricious Endeavours Ltd
#90 - 2013-10-09 13:42:03 UTC
You can't add teaching common sense to the market tutorial..
James Akachi
Perkone
Caldari State
#91 - 2013-10-09 13:48:45 UTC
TheMercenaryKing wrote:
So if i understand this scam it is like the contract and buy order scam where a minimum amount of x item (not sold on the market) is needed and the contract offers x items - 1. The person attempts to sell the items he/she bought on the contract and fails for minimum items requires. In this case its not the minimum items, its the amount of isk the buyer has.

Dude, if an offer looks too good to be true, it is. Why would someone make a contract for an item and then compare it to the market when they would get more isk by selling on the market buy orders?

No, it is placing a buy order that looks inviting by controlling the sell orders available, then lowering your wallet balance so when someone attempts to sell you the item, you cannot cover the purchase. With Margin Trading the "buyer" only needs to put a percentage of the buy order in escrow. The only problem I have is that it is then possible for the market to show buy orders that will fail, this makes no sense.
RubyPorto
RubysRhymes
#92 - 2013-10-09 16:14:38 UTC
James Akachi wrote:

No, it is placing a buy order that looks inviting by controlling the sell orders available, then lowering your wallet balance so when someone attempts to sell you the item, you cannot cover the purchase. With Margin Trading the "buyer" only needs to put a percentage of the buy order in escrow. The only problem I have is that it is then possible for the market to show buy orders that will fail, this makes no sense.



The ability to put up more buy orders than you can cover with your liquid balance is the entire point of the skill. And since a buy order failing cannot possibly hurt anyone (as they are left in the exact same position they were in before it failed), there's no reason to change this.

"It's easy to speak for the silent majority. They rarely object to what you put into their mouths." -Abrazzar "the risk of having your day ruined by other people is the cornerstone with which EVE was built" -CCP Solomon
James Akachi
Perkone
Caldari State
#93 - 2013-10-09 17:31:18 UTC  |  Edited by: James Akachi
RubyPorto wrote:
James Akachi wrote:

No, it is placing a buy order that looks inviting by controlling the sell orders available, then lowering your wallet balance so when someone attempts to sell you the item, you cannot cover the purchase. With Margin Trading the "buyer" only needs to put a percentage of the buy order in escrow. The only problem I have is that it is then possible for the market to show buy orders that will fail, this makes no sense.



The ability to put up more buy orders than you can cover with your liquid balance is the entire point of the skill. And since a buy order failing cannot possibly hurt anyone (as they are left in the exact same position they were in before it failed), there's no reason to change this.

The skill does not allow you to put up a buy order you cannot currently cover, am I mistaken?

If that is true then my suggested fixes would not affect those legitimately using the skill to put up multiple buy orders, but either it needs to be displayed which buy orders are not a guarantee, or they should simply be delisted when the buyer's funds are reduced.

The idea that the in-game market is displaying orders which cannot be fulfilled reflects poorly only on the game itself.
Gizznitt Malikite
Agony Unleashed
Agony Empire
#94 - 2013-10-09 20:34:09 UTC
William Bradley wrote:
Having waited a while for constructive replies to occur, and seeing none, I'll begrudgingly respond to the blatently deceptive responses of margin trade scammers trying to keep a broken system broken:

Mara Pahrdi wrote:
All risks connected to the margin trading skill are just general risks of doing business in EVE. They fit perfectly well with the overall design of the game when it comes to trading.


No, you are wrong; completely wrong. EVE is designed as more than a mere run of the mill MMO; it's a simulated universe. Your ignorant response is purposefully ignoring that fact to gloss over the inherent problem of in-game margin trade market fraud not being dealt with as it otherwise would be in a functioning world. It is the very reason I brought up the fraud angle in the first place. Looking at the game in terms of the characters as people acting within a real-world economy, anyone perpetrating the margin trade scams would very quickly find themselves on the losing-end of heavy fines, lawsuits, and/or extensive jail sentences.

Under the currently broken system, the only people who lose due to margin trade scams are the victims of said scams; there are no real or meaningful consequences for the perpetrators of those scams, and that is the point of my suggestions. Without the protection systems that should be in place, margin trade scammers are left scott-free to bloat the market with fraudulent orders that have an exactly 0% chance of being fulfilled due to the abuse of the system's current mechanics. That is not a correctly functioning or sensible system; it's flat-out broken.



First off, the only fraudulent element of the "margin trade scam" is the buy order. When the buy order fails, you keep the goods, and they lose the broker fees for setting up the order. Sorry if you think the ~1% broker fee loss isn't enough. You keep your goods in this scenario, so how is it unfair and broken to you?

Additionally, this is an MMO environment where you can AWOX, Steal, scam, and suicide gank players anywhere... with little to no NPC repercussions. Why would anyone care if some put up a false buy order?

Now, I do agree that margin trader scammers should be vulnerable to counter attacks. As such, I proposed Industrial, Market, and Financial Analysis agents to follow the money trail and identify the characters worthy of your retribution. Once you know who they are, there are plenty of in-game tools to go after them.
Gizznitt Malikite
Agony Unleashed
Agony Empire
#95 - 2013-10-09 21:06:09 UTC
Careby wrote:
The margin trading skill is fine.
In-game fraud is fine.
Capitalizing on the greed of other players is fine.

What is not fine is flawed market information. Market information should be 100% reliable at the time it is displayed. If an order cannot possible execute, it should not be visible in the market screens.



Sell orders are 100% reliable....

Why do buy orders need to be guaranteed?
Gizznitt Malikite
Agony Unleashed
Agony Empire
#96 - 2013-10-09 21:11:53 UTC
James Akachi wrote:
RubyPorto wrote:
James Akachi wrote:

No, it is placing a buy order that looks inviting by controlling the sell orders available, then lowering your wallet balance so when someone attempts to sell you the item, you cannot cover the purchase. With Margin Trading the "buyer" only needs to put a percentage of the buy order in escrow. The only problem I have is that it is then possible for the market to show buy orders that will fail, this makes no sense.



The ability to put up more buy orders than you can cover with your liquid balance is the entire point of the skill. And since a buy order failing cannot possibly hurt anyone (as they are left in the exact same position they were in before it failed), there's no reason to change this.

The skill does not allow you to put up a buy order you cannot currently cover, am I mistaken?

If that is true then my suggested fixes would not affect those legitimately using the skill to put up multiple buy orders, but either it needs to be displayed which buy orders are not a guarantee, or they should simply be delisted when the buyer's funds are reduced.

The idea that the in-game market is displaying orders which cannot be fulfilled reflects poorly only on the game itself.


You are mistaken: The margin trade skill allows you to put up an order you do not have the funds to fully cover. At MT5, you need 24% of the necessary isk to create an order.

FYI: There is no such thing as a GUARANTEED buy order. They don't exist in this game. Only sell orders are guaranteed, so run your business using that knowledge and you'll be fine!
Criseyde
Tribal Liberation Force
Minmatar Republic
#97 - 2013-10-09 21:55:38 UTC
I think there's two things interacting here:

  • The ability to specify a minimum number of items on a buy order.
  • The ability to create buy orders that will never ever complete, ever.


    • The easiest solution is to ensure that money for the minimum buy order unit is always present in escrow. If there is insufficient escrow, the order gets cancelled.

    E.g.

    Buy 50 tritanium @ 4.00 isk per unit, with min accepted quantity of 1 unit:
  • money in escrow due to margin trading = (50 * 4.00) * 0.24 = 48.00 isk
  • minimum unit price = 1 * 4.00 = 4.00 isk
  • 48.00 > 4.00, so 48.00 isk is the accepted escrow

    • Buy 4 tritanium @ 4.00 isk per unit, with min accepted quantity of 1 unit:
  • money in escrow due to margin trading = (4 * 4.00) * 0.24 = 3.84 isk
  • minimum unit price = 1 * 4.00 = 4.00 isk
  • 3.84 < 4.00, so 4.00 isk is the accepted escrow

    • Buy 50 tritanium @ 4.00 isk per unit, with min accepted quantity of 10 units:
  • money in escrow due to margin trading = (50 * 4.00) * 0.24 = 48.00 isk
  • minimum unit price = 10 * 4.00 = 40.00 isk
  • 40.00 < 48.00, so 48.00 isk is the accepted escrow

    • Buy 50 tritanium @ 4.00 isk per unit, with min accepted quantity of 25 units:
  • money in escrow due to margin trading = (50 * 4.00) * 0.24 = 48.00 isk
  • minimum unit price = 25 * 4.00 = 100.00 isk
  • 100.00 > 48.00, so 100.00 isk is the accepted escrow


    • (One possible implementation: Money is used from escrow to make purchases, up to the point where using more money from escrow would not cover the minimum buy order unit. At this point, further units are purchased with money from the wallet. If there is not enough money left in the wallet, the remaining escrow is used to buy one last item, and the order cancelled.)


    With this change, margin trading will work fine for legitimate purposes (e.g. station trading). It's also still possible to create scams (either specify a high minimum item count for a super rare item, or contract someone 10 items and only have money in escrow to buy back two of them). However, now the scammer must undergo some risk as well (someone sourcing a rare item elsewhere, or selling them two of the rare item).


    N.B. Obviously this would require CCP to decide that they want to remove / nerf this exploit. My own opinion is that it needs to go, but I'm not getting into a discussion on it. This is just to present a viable solution.
    RubyPorto
    RubysRhymes
    #98 - 2013-10-09 22:01:58 UTC
    Gizznitt Malikite wrote:

    You are mistaken: The margin trade skill allows you to put up an order you do not have the funds to fully cover. At MT5, you need 24% of the necessary isk to create an order.

    FYI: There is no such thing as a GUARANTEED buy order. They don't exist in this game. Only sell orders are guaranteed, so run your business using that knowledge and you'll be fine!


    There are no guaranteed sell orders either. They can be taken down or completed by someone else at any time.

    I've gotten the "there's no such order" error when buying stuff plenty of times.

    "It's easy to speak for the silent majority. They rarely object to what you put into their mouths." -Abrazzar "the risk of having your day ruined by other people is the cornerstone with which EVE was built" -CCP Solomon
    James Akachi
    Perkone
    Caldari State
    #99 - 2013-10-09 22:28:24 UTC  |  Edited by: James Akachi
    Gizznitt Malikite wrote:
    James Akachi wrote:
    RubyPorto wrote:
    James Akachi wrote:

    No, it is placing a buy order that looks inviting by controlling the sell orders available, then lowering your wallet balance so when someone attempts to sell you the item, you cannot cover the purchase. With Margin Trading the "buyer" only needs to put a percentage of the buy order in escrow. The only problem I have is that it is then possible for the market to show buy orders that will fail, this makes no sense.



    The ability to put up more buy orders than you can cover with your liquid balance is the entire point of the skill. And since a buy order failing cannot possibly hurt anyone (as they are left in the exact same position they were in before it failed), there's no reason to change this.

    The skill does not allow you to put up a buy order you cannot currently cover, am I mistaken?

    If that is true then my suggested fixes would not affect those legitimately using the skill to put up multiple buy orders, but either it needs to be displayed which buy orders are not a guarantee, or they should simply be delisted when the buyer's funds are reduced.

    The idea that the in-game market is displaying orders which cannot be fulfilled reflects poorly only on the game itself.


    You are mistaken: The margin trade skill allows you to put up an order you do not have the funds to fully cover. At MT5, you need 24% of the necessary isk to create an order.

    FYI: There is no such thing as a GUARANTEED buy order. They don't exist in this game. Only sell orders are guaranteed, so run your business using that knowledge and you'll be fine!

    It would be nice if this was indicated anywhere in the market or tutorials, then. With this in mind I will be sure never to try to make ISK off the market directly.
    James Akachi
    Perkone
    Caldari State
    #100 - 2013-10-09 22:30:34 UTC  |  Edited by: James Akachi
    RubyPorto wrote:
    Gizznitt Malikite wrote:

    You are mistaken: The margin trade skill allows you to put up an order you do not have the funds to fully cover. At MT5, you need 24% of the necessary isk to create an order.

    FYI: There is no such thing as a GUARANTEED buy order. They don't exist in this game. Only sell orders are guaranteed, so run your business using that knowledge and you'll be fine!


    There are no guaranteed sell orders either. They can be taken down or completed by someone else at any time.

    I've gotten the "there's no such order" error when buying stuff plenty of times.

    If they are taken down or completed then they go away. They don't stay up for the next several days, indicating a promise that cannot be fulfilled. Since this can apparently be done without having the money to begin with, I retract my suggestions, but this is a disconcerting system to say the least.