MMORPG Currency Exchange Fraud

GameSpot is reporting that someone fraudulently acquired $3000 worth of Star Wars Galaxies and Eve Online credits, causing the Gaming Open Market website to stop offering exchanges for such games. Sounds like a bad deal all around:

According to GOM President Jamie Hale, the perpetrator purchased $3,000 worth of Star Wars Galaxies and EVE Online credits. Immediately after he received the currencies in-game, he retracted the PayPal payment, claiming that the goods were never delivered. Hale suspects that incident is part of a larger case of identity theft.

GOM allows players of massively multiplayer online games to exchange in-game currencies for real-life dollars. The company holds the game currencies for sellers, and after receiving payment via PayPal, delivers the purchased currencies to the buyers through in-game avatars. The incident takes advantage of a PayPal policy in which sellers of (intangible goods,) such as a subscriptions or computer software, receive no protection because there is no widely accepted proof-of-shipment methods for these goods.