Pssst, wanna buy some Lindens? How about some virtual gold? Hundi and Hawala have great conversion rates just now, don’t miss out!

Welcome to the exciting new world of virtual money laundering. In case you are not aware, Linden dollars and virtual gold are types of online gaming ‘currency’ that can be acquired with real money on the open market. And, wherever there is the chance to move money around unchecked, the money launderers will be on board before you know it.

A report emanating from IT News in Australia that the country’s Federal and State police forces have deployed resources to investigate virtual worlds to combat this type of money laundering by cybercriminals.

Outside of games, online money transfer services such as e-gold and Hawala, also known as Hundi, are methods allegedly being used by criminals to obfuscate the source of funds.

Hundi has a network of unofficial brokers who performed international transactions by having one broker accept a sum of money in one country. The broker’s overseas colleague would then pay the corresponding sum to the intended recipient, and the two brokers would resolve their settlement at a later date.

That made transactions “very hard to trace”, NSW Detective Superintendent Commander Colin Dyson told iTnews at the Cards and Payments Australasia conference in Sydney yesterday.

Cross-border jurisdictions and a global, anonymous online environment were also a challenge for police, who had to operate within the confines of privacy law.

Dyson said that police were also aware of a “burgeoning market for financial and identity information” that was being bought, traded and sold via online sites and discussion boards, and that cybercriminals had become more technologically sophisticated than many financial institutions.

This is almost as weird as the case of a virtual bank in the EVE Online site back in 2009 where another enterprising Australian managed to embezzle about 20 billion ‘interstellar kredits’, the game’s virtual currency, and then sold them on the ‘real’ open market for $6,300!

Wow, it’s not enough we have to be constantly vigilant to physical fraudsters, now we have to be on the lookout for the virtual ones as well.  Where does it end?