Micropayments add up to a bust
Shades of Office Space! Someone’s used the Internet to stick it to a couple of financial companies, a few cents at a time.
E-trade and Schwab.com doled out a few cents here and there to Michael Largent, enough to top the $50,000 mark once he added Google Checkout to his targets. Through the practice of issuing a micropayment to verify the existence of a new account, financial companies pumped up Largent’s finances.
Wired highlighted the details of Largent’s actions, as his enterprise came crashing down amid a Patriot Act requirement to verify the identities of people opening bank accounts:
A May 7 Secret Service search warrant affidavit (.pdf) says Largent tried the same thing with Google’s Checkout service, accumulating $8,225.29 in eight different bank accounts at Bancorp Bank.
When the bank asked Largent about the thousands of small transfers, he told them that he’d read Google’s terms of service, and that it didn’t prohibit multiple e-mail addresses and accounts. “He stated he needed the money to pay off debts and stated that this was one way to earn money, by setting up multiple accounts having Google submit the two small deposits.”
Largent faces federal charges for his actions. He could end up someplace that pays him pennies for his work: the federal prison system, if he is found guilty of various fraud accusations.