Yes is working great but we (or better, you DT members) need to be more strict to punish abusers.
I remember this:
Merit sales, transfers to aliases, back-and-forth trading, etc. are not much of an issue. All illegitimate merit will decay, and will account for a tiny and very expensive fraction of the total merit economy. It's basically a rounding error; fight it where convenient, but waste no sleep over it.
I've been on DT2 for 2 months now, and only tag red on accounts that I believe deserve it without a doubt. So far I haven't tagged merit abusers, and I'm not planning on changing that. I do like how the
5 merit abusers received red trust from 5 different DT-members. That seems better than all of it coming from the same person.