Online Gambling Regulators Display Concern Over Video Games

By Alex Smith, Last updated Mar 1, 2021

As online video games continue to grow in popularity, the so called ‘loot boxes’ which many companies are now including in their games are beginning to come under scrutiny by online gambling regulators. Citing a ‘blurring of lines between gambling and gaming’, these loot boxes and skin betting mechanisms essentially allow video game players to purchase in-game items without knowing exactly what they’ll receive.

In total, 16 gambling regulators have come together and penned a letter which expresses their concerns with skin betting and loot boxes – and they’ve all reiterated their commitment to preventing underage gambling – something they fear is being ignored by video game companies as they continue to encourage users to buy these loot boxes in-game.

The 16 regulators who have voiced their concerns include 15 from European countries, and one from Washington State. Their primary goal of writing this letter is to address the potential problems caused by skin betting and loot boxes – and they hope to enter into conversation with video game and social gaming industries in order to find an amicable solution, without needing to resort to legislation.

The Chief Executive and signatory for the Gambling Commission, Neil McArthur, said: “We encourage video games companies to work with their gambling regulators and take action now to address those concerns to make sure that consumers, and particularly children, are protected.”

The letter also noted that it would be “in the interest of these companies whose platforms or games are prompting concern, to engage with regulatory authorities to develop possible solutions.”

Along with reaching the video game companies themselves, the letter also aims to raise awareness amongst parents and consumers about the potential dangers associated with the gambling-like features included within video games.

“We want parents to be aware of the risks and to talk to their children about how to stay safe online. For example, unlicensed websites offering skins betting can pop up at any time and children could be gambling with money intended for computer game products,” added Neil.

His comments come at a time when the UK Gambling Commission has already been aggressively tackling third-party websites that offer illegal gambling, linked to popular video games such as Fortnite, and he’s made it clear that if video game companies are unable to cooperate and enter into a dialogue with regulators, the Gambling Commission won’t hesitate to take legal action against companies who refuse.

Indeed, some countries have already taken action against video game developers – and in Belgium, the government has officially opened a criminal investigation into global giant EA Games, for continuing to offer loot boxes within their games despite the government ruling that doing so is offering gambling facilities illegally.

At a time when responsible gambling is becoming ever-more prevalent, it’s likely that we’ll see these regulators continue to take action against video game developers who choose to ignore their warnings – and the Belgian case against EA Games is very likely to set a precedent that other regulators around the world may use to follow-suit in pressing charges against companies who ignore their warnings.

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