1.- Was it an "extortion" attempt or a "sting operation" attempt?
As far as I can understand, it was a failed sting operation which is, in many law enforcement jurisdictions, allowed, legal and ethical. Here in Italy where I live, for example, there are even some interesting TV shows recording "sting operations" (failed or succeed depending on the luck) and people simply approve those sting operations eating popcorns while they watch at criminal being caught. See i.e. "Striscia la Notizia" or "Le Iene" movies which are very popular and both broadcasted on national TVs. Here you can see sting operations against any crimes: tax evaders, drug dealers, money laundering and counterfeit, prostitution and so on. I don't think Italy is so far away from other forum member's jurisdictions, isn't it? It would never happen, indeed, that people would believe or mix up the real criminal with the sting operation team (sorry Zeroxal I'm talking in general as I don't know you, nor I have facts that would bring me to understand you committed any crime, nor I'm interested in). How is it possible to turn the sting operation team into the actual criminals if they fail? Again: was it an extortion attempt or a sting operation attempt? (Have I asked it enough already?)
For your reference:
For our purposes, a sting operation is defined as any effort by the authorities to encourage wrongdoing, with the intention of punishing the offenses that result. Normally a sting operation is carried out by agents acting undercover, that is, concealing the fact that they work for the authorities. An agent might be a full-time police officer disguised as a private citizen.
http://scholarship.law.missouri.edu/cgi/viewcontent.cgi?article=3652&context=mlrExtortion definition:
http://prntscr.com/e2599bBoth are different attempts where the former one is to catch the person red-handed, the later is to try to extract information while the person is aware of it.
Zeroxal was aware of what he was being asked and hence it's an extortion attempt and as TMAN earlier said, it was a failed one. I don't know if the user being accused of the crimes was actually a criminal. I do respect Lauda as he is a reputed user and don't accuse him of extracting money or anything but it was extracting information or trying to get Zeroxal to admit instead.
@Shorena: Thanks for the explanation on permaban.