The Times Online U.K. is reporting that the British government may soon step in to start regulating virtual worlds more closely, citing "causes for concern" that include identity theft, money laundering, copyright violation and exploitation of children.

At the Virtual Worlds Forum in London, Lord Triesman, a minister at the Department For Innovation, Universities and Skills, said that virtual worlds present "sharp challenges" in terms of moderating and controlling illegal or anti-social activities, though he allowed that they are "one of the most exciting technological developments in recent years."

He encouraged companies that develop and operate virtual worlds to take an active role in regulation, but indicated that government involvement would at some point be inevitable. Lord Triesman did not, however, comment on specific laws that may be in the pipeline, and he sidestepped the controversial taxation issue, calling it a matter for the Treasury.

[Via Times Online UK]