They say there’s no honor among thieves. This is also true of
the shadow economy. Fraud and rip-offs are so common that a
system of guarantors and escrow accounts has emerged. For
example, a drop service provider might offer a guarantee to an
identity thief that they will be paid their cut of the sale of any
goods, even if individual fences don’t pay up.
Similarly, guarantors will provide an escrow service. For example,
a buyer will transfer payment to the guarantor and the seller will
transmit the virus code or the credit card numbers.
If the goods check out the funds are released. Typically, these
guarantors take 2-3% of the transaction value for
their services. The emergence of these services
shows a developing sophistication in the market,
driven by economics more than technology or
the demands of organized crime. It also shows
there are participants who value their long-term reputation.
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