This is the sort of paranoia we need more of around here!
In this case, a less trusted forum member (me) was leveraging the trust of someone who was much more trusted. Michael Hendrix met all my requirements for how to choose someone to trust if you must (listed above), except obviously he had no insurance himself. In that forum thread I was telling the people placing bets that they don't need to trust me if they trust him, since he was holding my bond.
We could have been in cahoots, but there wouldn't be any point to doing that. Michael already has a lot of trust - he doesn't need my help to scam people if he decides he wants to do so.