Coming Soon to Second Life: FBI Field Office

Second Life, the popular "virtual world" created and operated by Linden Labs, is certainly proving to be on the cutting edge of real/virtual legal issues.


First, back in May, German police launched an investigation into alleged inworld child pornography (this investigation ultimately seems to have subsided in the wake of the recently-announced deal between Linden Labs and Washington DC-based age-verification company, Aristotle).

Then ten days ago, virtual thieves stole at least US$11,500 in *real money* from avatar-customers of virtual banks located inside Second Life.

According to Nobody Fugazi, an avatar/commentator who runs a Second Life fan site called your2ndplace.com, the hacked Second Life banks included L&L Bank and Trust, SL Investor's Bank, Giovinazzo Choice Investments, Whitfield Holdings/Royal Invest and SL Business Bank.

L&L Bank and Trust has admitted they lost $11,000. Nobody Fugazi was quoted on Massively.com as saying he believed SL Investor's Bank did not suffer any losses.

When the news broke, users, who spend about US$1.5mm in real money every day in Second Life, were understandably upset (one blogged that "the sky ripped apart" when he found out the theft had happened). Second Life citizen "Gr1zz" left this response, not untypical, at Massively.com:

"I have alwase felt virtural property IS PERSIONAL PROPERTY! Wether you work long and hard for in game credits, or purchase them with real dollars, its damaging when you loose it. "

Spelling mistakes aside, this comment raises some interesting questions about Second Life, the nature of its assets, how its citizens feel about those assets, the duty Second Life has to protect their value, and the whole idea that an entire economy and banking environment based on the US$ should be allowed to exist, regulation-free.

$11,000, the "real" amount publicly acknowledged as lost by L&L Bank and Trust, would probably not normally be a large-enough amount for the FBI to get involved, but if they don't get involved, what is going to happen when things get serious?

Authentium says: the FBI should consider treating these virtual heists as real crimes, so we're ready and prepared when the first large-scale virtual heist happens inworld, which may be for a considerable amount more Linden dollars than the heists two weeks ago.

Note: Anyone wishing to peer inside the mind of a Second Life bank should venture here for an informative read, courtesy of the SL Investor's Bank blog.

Note: The chart above is courtesy of the Reuters inworld Second Life news office. To see the live updating Linden dollars vs. USD conversion and daily spending widgets, click here.