Second Life operator Linden Lab of San Francisco now bans members from offering interest or any direct return on cash investments unless they have real-world proof they are a legitimate financial institution.

Since an in-world bank called Ginko Financial collapsed in August of last year Second Life has been bombarded with complaints about such operations breaking promises of wildly high annual rates of return.

The situation posed legal hazards and threatened to destabilize the Second Life economy, has its own currency, called Lindens, which can be earned in-world or bought with real-world cash, according to Linden Lab.

"We're implementing this policy after reviewing resident complaints, banking activities, and the law, and we're doing it to protect our residents and the integrity of our economy," Second Life said a website posting.

"Usually, we don't step in the middle of resident-to-resident conduct -- letting residents decide how to act, live, or play in Second Life," the company said.

"But these 'banks' have brought unique and substantial risks ... Offering unsustainably high interest rates, they are in most cases doomed to collapse leaving upset 'depositors' with nothing to show for their investments."

Last year, Second Life banned gambling and began requiring operators of in-world locales with sexual or other adult themes to verify ages of people whose animated proxies seek access.

Some residents complain about real-world regulations creeping into a virtual realm that claims as its motto "Your world -- Your imagination."

"The more regulation enforced upon residents, the more SL becomes like the real world," resident Keiko Rau laments in a forum discussing the new in-world banking regulation.

"It is not 'My Imagination' if I am not permitted to create anything that I can imagine, and that motto has outlived its use-by date."

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