Without any insights in general of your specifics I found it odd that websites a site where there has been NO "link building" at all would receive a message for unnatural links.

Without any insights in general of your specifics I found it odd that any website not link building would have 3rd parties that would find such a website competing with them.

I know every domain have less desirable links but those do usually promote thus in the great scheme of thing aren`t all that unnatural as far a manipulation.goes.

I caution webmasters not to knee-jerk everything as ìt was a competitor... more likely it is complacency and forgotten knowledge.

I did check archive.org and found a blogroll on your domain (no idea when that was removed) with many domains included which suggests you did participate in blog networking. What you link to can get you into problem faster than what links to you.

Dan I known you for a long time and we have a duty not to merely speculate on causes because of we don`t do painstakingly hard research we both know the uneducated will simply point and say `see`a competitor did this.

Just because the labels change doesn't mean the new version isn't the old version in drag.

Google writes about blogrolls on its Paid Links references:

Paid links

Google and most other search engines use links to determine reputation. A site's ranking in Google search results is partly based on analysis of those sites that link to it. Link-based analysis is an extremely useful way of measuring a site's value, and has greatly improved the quality of web search. Both the quantity and, more importantly, the quality of links count towards this rating.

However, some SEOs and webmasters engage in the practice of buying and selling links that pass PageRank, disregarding the quality of the links, the sources, and the long-term impact it will have on their sites. Buying or selling links that pass PageRank is in violation of Google's Webmaster Guidelines and can negatively impact a site's ranking in search results.

Not all paid links violate our guidelines. Buying and selling links is a normal part of the economy of the web when done for advertising purposes, and not for manipulation of search results. Links purchased for advertising should be designated as such. This can be done in several ways, such as:

Adding a rel="nofollow" attribute to the <a> tag
Redirecting the links to an intermediate page that is blocked from search engines with a robots.txt file

Google works hard to ensure that it fully discounts links intended to manipulate search engine results, such as excessive link exchanges and purchased links that pass PageRank. If you see a site that is buying or selling links that pass PageRank, let us know. We'll use your information to improve our algorithmic detection of such links.

"I'll link to you if you link to me"... excessively (e.g. every page like a blogroll or excessive friends pages or excessive links pages, or excessive sitewide links or commonly called paid links if your didn`t know yourself or your friends) would be unnatural especially if this is a high percentage of your profile.

The link wheel came about with the invention of the blogroll... calling it something different does not change to nature of the development.

No matter what you call it... we do it to advertise and that means to be in Google`s good graces to add nofollow to those.

I cannot claim this it what happen to your domains... I simply saying that speculation in our business that someone intentional did this to you (without conclusive proof of who) just makes everyone ignore their own responsibilities.

I agree with John Mu... it would be very very rare for this to happen... just like it would be very very rare for you link spam but seriously you had a blogroll of friends in a sidebar with sitewide links to them... and those are identical to paid links (pattern wise).