The Scam Ratio

Higher mathematics—yes, it separates the “scrupulous sheep” from the “gulling goats”—but there’s a fly in the ointment—why a “scammy” site might be ideal for a knight in shining armour—why you need not have read this blog entry in the first place (hint!). ... Masochistium Clickium Hic!

Doing your Sums

For the accountants amongst you who like to reduce everything to ratios we have a candidate to add to your portfolio. We call it the “scam ratio”. Here’s how to calculate it:

Find a search string that uniquely identifies the site in question. Use Google to calculate the total number of hits (TH). Then repeat the search, but this time append the word “scam” to the search string to calculate the total number of scam hits (SH). Then the scam ratio, expressed as a percentage, equals (100 x SH / TH)—makes you feel as though you were back in school, doesn’t it!

Now, does this statistic provide a simple means to separate the “scrupulous sheep” from the “gulling goats”? Well, let’s investigate.

It’s looking Good

Let’s take some major sites that don’t operate scams—well, at least not overtly:

Brand Scam Ratio
  Amazon 0.3%  
  Intel 0.3%  
  Microsoft 0.2%  

Some Good Guys

Scam ratios of less than 1% are typical of major companies operating in non-controversial business areas.

Now, let’s take some well-known scams:

Brand Scam Ratio
  Prof Resources System Int. 63%  
  Fortuna Alliance 56%  
  Drivers Seat Network 52%  
  Bounty International Lottery 49%  

Some Bad Guys

Scam ratios of around 50% are typical for the most palpable of scams. So clearly, the scam ratio delivers the goods?

But, not so fast

Let’s calculate the scam ratios for the major e-currency issuers:

Brand Scam Ratio
  e-gold 36.0%  
  Pecunix 25.0%  
  1mdc 1.2%  

E-currency Issuers

A naïve interpretation of these figures would suggest that e-gold and Pecunix were operating scams, and that only 1mdc could be relied upon.

However, the reason for the high scam ratios for e-gold and Pecunix is that these e-currency issuers are very widely known and are usually mentioned in general articles dealing with e-currency. But these same articles will almost invariably refer to the scams that so often make use of e-currencies. Because 1mdc is less well known (and is a pseudo-issuer) it does not appear so frequently in these articles, and hence the scam ratio grants it an unwarranted reputability in comparison to its more illustrious bed-follows.

So if our scam ratio is to be of any use at all, then it’s important to read a specimen number of the entries which contain hits for the word “scam” and the site in question, and then determine if these entries are accusing the site of being directly involved in a scam, or whether references to the word “scam” are simply commonly associated with the business sector within which the site operates.

Clearly, what matters is how the scam ratio varies between different businesses operating within the same sector (and even given these strictures anomalies can still arise, as with the case of 1mdc).

Is it too clean?

So should you choose from amongst those businesses with the lowest scam ratios in the sector of interest? Not necessarily!

Let’s take the example of web hosting. A typical on-shore web hosting company will keep detailed logs and pass these logs over to Big Brother at the first whiff of a court order. On the other hand, a web hosting company that respects your privacy will destroy all detailed logs, and will be based in a jurisdiction that respects the privacy of both its citizens and its businesses.

Now those businesses operating scams have very good noses for where they can keep their operations private. And even if a web hosting company takes down a site as soon as it discovers that the site is operating a scam, those web-hosting companies that respect their client’s privacy will still get a reputation for being associated with scams. So, if you want to blow the whistle on Big Brother, then a web hosting company with at least a modest scam ratio might well be just what you need, for the anonymity that helps protect the scammers from the scammed is the very same anonymity that will help protect you from Big Brother!


So now you can see the reason why we introduced you to the “scam ratio”: it was to illustrate that, in practice, when it comes to determining whether a site is operating a scam it just isn’t that simple!

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