The TechCons

Selling sometimes involves trickery. How should we decide what trickery is "swindling" versus ordinary "selling"? One method is elucidated in Yale Law Professor Arthur Leff's curious, lost-to-history book. In "Swindling and Selling: The Story of Legal and Illegal Congames", Leff showed how market structure is a powerful factor for distinguishing illegal confidence games ("congames") what he called "swindling" from legal "selling." Leff demonstrated how con artists weave narratives to convince marks they have a monopoly over some desirable asset. Con artists then manipulate marks to mistakenly believe they possess a monopsony over its capture. This essay revisits Leff's mostly forgotten approach and applies it to internet swindling techniques: the TechCons. Leff's 50-yearold, pre-internet framework provides a powerful rationale for why internet frauds still exist, despite the revolution of information availability brought by the Internet. A market structure analysis also explains how the internet makes ordinary cons more powerful. TechCons are different from pre-internet cons in important ways; the internet enables con artists to cast a wider recruitment net, but also to deepen injury to fraud victims caught in it. Finally, this essay applies Leff's framework to three controversial internet activities: phishing, cryptocurrencies, and online advertising. Application reveals that market structure interventions may be effective tools in deterring swindling while allowing selling. It also highlights a critique of the law and economics movement. Leff's thinking was profoundly influenced by law and economic approaches. Yet, he also believed that lawyers' focus should be on real, individual consumers rather than notional ones with perfect rationality. Leff's focus on transaction costs and the roles cast by businesses for consumers to play offers a rich, realist, and entertaining method to understand technology sales and cons.