Quote from: Jack of Diamonds on August 12, 2011, 07:55:54 AM

Quote from: SgtSpike on August 11, 2011, 11:35:59 PM

I think BTCGuild was accused of this recently.

The bottom line is, yes, it is possible, and no, you couldn't detect it if it was well-hidden.

If you use a PPS derivative reward scheme it doesn't matter.
Since the operator has only two options, to pay for your submitted shares or get labeled as a scammer

PPS fraud would be instantly visible within less than a week, since there is zero variance & multiple miners would be reporting 2-3% less than average earnings suddenly.

Maybe if you take 0.1% or a similar amount, it would be brushed off as a normal occurrence.
Doesn't sound too profitable though.

Bigger pools can already earn enough without risking their entire reputation.

Yeah, I do like the PPS model. It's just that pools have to take so much in fees to account for the potential variance that could literally bankrupt them.