[e-gold-list] Policy concerns and suggestions

[Kyle Markley]

I have some concerns and suggesions.

http://www.wired.com/news/technology/0,72278-0.html
"His lawyers also say that once the company discovered evidence of  
possible wrongdoing, it had no choice but to hand over information to the  
government. Jackson could even have been charged with aiding and abetting  
money launderers under federal statutes if he didn't report the suspicious  
activity."

http://www.e-gold.com/unsecure/terms.htm
3.7.2. Unless (1) otherwise approved by User or (2) ordered by a court or  
arbitration body of acceptable jurisdiction, as determined by Issuer,  
Issuer shall not reveal User’s contact or identifying information or  
transaction history to any third party.

I suggest that e-gold update its account agreement to include the phrase  
"or (3) required by law" in section 3.7.2.  However, e-gold should  
specifically point out that U.S. law, in addition to Nevis law, may  
require e-gold to reveal information about users.



This recent exchange on this list also troubles me:

On Tue, 12 Dec 2006 13:25:07 +0100, "Finexe" <afw at finexe.com> said:
>> This behaviour by e-gold is not something you expect from a trustworthy
>> company. This list has lots of complaints on Paypal for carelessly
>> frreezing accounts. I ask, how is e-gold's action better than paypal's?
>> At least paypal just freeze accounts, then they talk with you and
>> resolve the issues when you have sent them documentation. And they are
>> polite at all times.

On Wed, 13 Dec 2006 05:27:24 -0800, Graham Kelly <kelly_clan at fastmail.fm>  
wrote:
> Au contraire. The fact that e-gold are closing down accounts that are
> proven to be (previously) used fraudulently, is just another "bow in
> their string" as far as safety is concerned, for the rest of the users
> of e-gold.

The accounts e-gold closed down have not, to my understanding, been  
*proven* to be involved in illegal activity.  They are merely *suspected*  
to be involved in illegal activity.

Can we please be more rigorous and describe accounts as being "frozen" or  
"value limited"?  The descriptions "closed down" and "blocked" are unclear  
and only confuse.


Are there any exchangers that process out-exchanges from value limited  
accounts?  Given that e-gold's account agreement gives it the power to  
value limit accounts without cause, I fully expect that some good and  
totally innocent people have had their accounts value limited.  How do  
such people get the value out of their accounts?  It would be terribly  
unjust if the value in their accounts was totally lost merely due to a  
mistake on e-gold's part.

As a "good and totally innocent" person with a substantial value in my  
account, I certainly worry that this could affect me.  An official  
statement about such situations would go a long way toward assuaging my  
fears.


According to section 4.6 of the account agreement, e-gold may value limit  
an account at any time for any reason, but it may only freeze an account  
if the user attacks the e-gold system or if ordered to by a court.

I  believe that e-gold froze the accounts of Iranian customers due to some  
kind of government action, similar to reports by U.K. banks:
http://regimechangeiniran.com/2006/12/us-tells-banks-to-shut-down-ir/
However, e-gold has made no announcement regarding this situation.

I do believe that if e-gold is freezing an account, it has an obligation  
to state the reason for the freeze in a manner that enables the user to  
independently verify it.  Otherwise the user cannot distinguish a  
legitimate freeze from e-gold violating its own account agreement, placing  
e-gold at risk of lawsuits.

I think the official silence on the Iran situation has gone on long enough  
and it's time we heard the real story.

-- 
Kyle Markley


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