Possible Credit Card Fraud carried out on Splinterlands?

in Splinterlands11 months ago

Several players of Splinterlands noticed shady market sales yesterday and we discussed them on Discord while watching huge amount of DECs getting dumped on the steem-engine market, resulting in huge drop in DEC prices.

What happen?

It was noticed that there were several peculiar purchases of single BCX cards at abnormal prices. The below is just one of the many sales by @makeyourhour to @juihui. A single BCX common card sold for $801.70 for more than 2 million DECs.
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The DECs are then dumped onto steem-engine market and other TRX market, for Steem and TRX. The Steem are then swiftly cashed out via Binance and other exchanges.

How much?

According to some players' investigations, there could be more than 12 million DECs worth over $8000 made by this person.

How it works?

It seems like the person was buying Splinterlands Credits using a (possible stolen?) credit card. Splinterlands Credits can be bought via Paypal without any need for KYC.

The Credits were then used to buy cards from the game's market at crazy prices ($800 for a common card). The seller of the card (likely to be the same person) will receive DECs equivalent to the sales (8 million in this one purchase).

The DECs are then quickly dumped for other cryptos on various markets.

Very clearly, this person is trying to launder money. He does not seem to be worried about losing money (there is a 5% market fee by the game, selling DECs in such quantity crashes the market too) all he wants is to quickly cash the Splinterlands Credits purchased through his credit card. This had to be a credit card fraud.

Impact to Splinterlands

First, these activities are crashing the DEC market. The prices of DECs drop almost 50% overnight.

Second, although it is bringing in money to Splinterlands (through Credits purchase), but it is very likely that Paypal will chargeback these purchases soon. If the credit cards used are really stolen, a fraud investigation might arise and in the worst case, Paypal might suspend or ban the Splinterlands account.

I am not sure what the Splinterlands team is going to do about this. Looks like there isn't much they can do though. But if such activity continues, it is going to bring a bad name to the game.

Sort:  

Yabapmatt blocked the accounts right away and changed a few things in case it happens again. He is always on top of things in Splinterlands.

Glad to hear that

When I bought my account, I also noticed that they do not require KYC. I remember working for a company, selling virtual goods being super careful with paypal.

Any plans on how to prevent this happening, that's a challenging one!

easy, stop accepting bs like credit cards.

I haven't heard anything from aggroed nor yabapmatt, so I guess they are probably ok with these activities....

Block card sales with unusual (say, 50% higher than average) BCX price for manual investigation.

As much as we hate kycs this might just prove why it's a necessary evil at times...