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Tuesday, June 13, 2017

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Gordon

So I'm still open to other theories -- anyone?

Linden Lab will retain the payouts until their increased credit processing fees come into effect.

https://community.secondlife.com/blogs/entry/2187-updates-to-lindex-and-credit-processing-fees/

Eldred

I think they are trying to be regulatory compliant but being sneaky by holding funds hostage which they keep in their correspondent banking account earning interest.

Per their own admission they churn 60 Million USD a year out in payouts to creators.
Just keeping that cashflow slowing down and held up as USD in their own account has a significant business benefit to them.

Also 25 USD to cash out now, which will lead people to hold the money even longer to save money on the fees, keeping more USD in that account above for Linden Lab.

Linden Lab are a rare beast in they still can't after many years complete same day PayPal cash out to established creators who have provided tax and identity information. Probably again to hold back that USD for funding interest benefit.

Patchouli Woollahra

Holding the payouts till the credproc fee increase goes through makes sense in a strange sort of way - if you subscribe to the school of thought that sees mal fides in everything. It may be simply be that part of the changeover process requires the suspension of approvals for such credit processes.

The act of processing credit into actual real-world cash requires a level of prudence as well. L$ have been obtained by fraudulent means inworld before on innumberable instances, and then converted into (by logical inference) ill-gotten real-world currency for withdrawal. The spectre of money laundering via transfers of L$ purchased with dirty money in an attempt to blur the trail US federal regulators are watching is also present

While there are US laws in place to prosecute illegal use of credit cards/payment systems (either fraud or laundering etc) as felonies, the wheels of real-world law where only 'small' (their definition, not ours) amounts of money have been lost tend to unfortunately grind too slowly, and LL needs to make good on the losses in the meantime. When credit fraud occurs, the merchant is more often than not left holding the bag on losses regardless of how much care they took to watch for possible fraud in this day and age. While loathesome, I can accept that due diligence is to some extent a necessary drag on the flow of money out of SL.

As for the increase in the ceiling on credit processing fees to 25USD, consider this: not too many financial services impose such ceilings on their fees unless legally obliged or held down by the need to attract and keep customers away from competitors. I would also point out that same-day credit transfers between different financial institutions is prohibitively expensive, if possible at all. (try asking your bank for the cost of a telegraphic transfer, you might be shocked) LL may have opted for a still-secure but lower priority credit processing method in order to reduce these operational costs as well.

Still, LL does owes us a reasonable explanation on a lot of things: does the credit processing fee include insurance against losses due to payouts on fradulently obtained US$? How much of this has been forced on them by their own providers?

While it may not be possible to provide some details due to agreements with others, LL's silence on this matter to date has proven fertile ground for ill-willed talk that may or may not be groundless.

Carlos Loff

It is not ilegal to have several accounts on SL - It is not ilegal to have the same Paypal account on several ALTs - So it is not ilegal and does not have extra fees to offer Lindens to the other alts - 4 Accounts = 1.999$ X 4 = redrawal per 30 days - 8.000$/month, a great salary

Susan

And now there is a new $10 increase on maxim payouts - from $15 to $25. It's starting to feel like SL creators are paying for Sansar development.

Eldred

@ Patchouli - sorry that's not correct.

Real time bank transfers in the US should average a cost of 3-10 USD at major institutions (and do for those in good standing).

PayPal processing is NOT the same as same day wire transfers not even close, and has a real-time mechanism that was developed to complete with banks. Hence why the excuse of it being expensive, is a fallacy.

Anti Money Laundering, trust me nobody is using "cash" to purchase Lindens. It's all from an electronic source, then has different requirements.

I have been in SL 12 years, I have not once had Linden removed from my account due to receiving "illegal" ones -so how prevalent is it now LL closed off the exchanges? Again I see hyperbole in these comments, versus reality of the situation at hand. Most creators I know (who are very well established) have the same feedback.

If creators have (a) been trading more than 12 months and (b) have provided identify and verification information (most have now I believe) there is no regulatory, legal or other made up reason not to credit them same day.

Now, if LL are suffering from PayPal chargebacks, that's a simple solution - you ban/block the account limiting loses to minimal amounts and new accounts have purchase limits anyway which again further protects LL.

People forget Linden Lab hold that USD in a nice interest bearing account and have incentive to pay people as SLOWLY as possible.

It should also be noted, to even think about laundering money in SL (which always makes me chuckle as my real life job is an anti-money laundering investigator for a large bank), the end cash out always ends in a PayPal which as a MSB will also report under 1099 to IRS where conditions are met. It would be incredibly difficult to launder anything of value as to get all the cash into that system would require you to have multiple pre-paid cards on the scale that would clear out your whole local Duane Reade, and CVS branches and then opps you hit the LL limit so you can't get the money in.

Point of note I am pretty sure LL no longer accept prepaid cards, but I'll have to check on that.

Considering how the user base is dwindling, Sansar has been delayed for months on end (and still is miles away from primetime), trust me when I say they are holding that money back for profit, not regulatory concern.

Eldred

I should also note not just PayPal - they use other electronic money service providers e.g. Skrill but all meet the same 1099 reporting.

And per the knowledgeable they do not accept pre-paid cards for the most part.... so getting "dirty" cash to layer it into the system could not occur via LL directly.

From the knowledge base:

At this time, the majority of prepaid cards are not compatible with our system, even if they bear the VISA/AMEX/Mastercard logo. This includes cards purchased at retail stores, rechargeable credit cards, and bank-issued check cards.

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