What is going on with The Division's beta problems?

The Division’s a great, tactically focused co-op shooter that abuses online trust and paranoia in a fascinating way. Feedback from the beta however seems to have picked out a critical issue with how things work online that could have implications for the game as a whole.

There’s a really good round up of the problem here, but essentially the beta currently stores quite a lot of information on the 'client side', which is fancy netcode speak for 'your console'. This can cause syncing issues between client and server. The phrasing people are using is that the server 'trusts' the client, leading to unlimited ammo, gear, altered critical chances and so on when it gets it wrong. There's also talk of a super-speed issue causing players to become invisible and immortal (which I've have direct experience of) although that seems more likely to be a more common or garden glitch. There's more information here and here.

The question is whether that work is minimising these issues but still using the beta's current client-side system (so that's data stored on your console), or preparing a more stable server-based option for the final game which would store data online and prevent sync issues. It's a switch that apparently involves little more than a button press. The current system used in the beta could simply be to reduce server costs while testing or because the final system isn’t ready yet.