Your kids may treat video games like banks and play for real money. The government has questions. | Trending Viral hub

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A federal agency announced that it is monitoring video games that include in-app purchases, digital currencies and external marketplaces that are often used by children.

Games that include these features can effectively operate as a kind of bank, but they are not subject to the same type of regulations or protections, according to a report from the Consumer Financial Protection Bureau released last week. The agency also questioned whether children or parents were aware of the vast amounts of data gaming companies collect.

“For several years now, the most popular video games have included immersive virtual worlds that offer the storage and sharing of valuable assets,” the CFPB wrote. “Gaming companies have created digital marketplaces that facilitate the buying, selling and trading of these assets with limited consumer protections, which has led to potentially harmful practices for players, including financial losses due to theft and scams.”

During years, video games like the mega-hit “Fortnite” have allowed users to make microtransactions: small optional fees that players can pay to obtain items or other features. In many cases, users must purchase in-game currencies purchased with real dollars, similar to tokens purchased at brick-and-mortar places like Dave & Buster’s or Chuck E. Cheese.

Boy plays Fortnite

CFPD reported that video games like Fortnite could be children’s introduction to banking. (Neilson Barnard/Getty Images)

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The CFPB warned that digital currencies, purchased items and other assets can represent “substantial value” in terms of real money. But those closed markets are not subject to regulations meant to protect asset holders.

“Banking and payment services that facilitate the storage and exchange of valuable assets generally provide consumer protections, including recourse after unauthorized transactions,” the CFPB wrote in its report. “However, gaming and virtual world operators often emphasize a ‘buyer beware’ approach.”

The agency was particularly worried about the childrenwho may be using these markets without their parents knowing.

“For many young people today, gaming can be their introduction to financial activity,” the CFPB wrote. “For example, games give young people the opportunity to learn how to make money, manage assets and make purchases.”

The Lego Fortnite website is displayed behind the video game logo

A CFPB report warned that video games with features like in-app purchases and digital currencies behave like banks but are not subject to the same regulations. (Jakub Porzycki/NurPhoto via Getty Images)

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“Gaming companies can see young gamers as an opportunity to create lifelong consumers early,” the report continues.

Because players can accumulate assets in these video games Worth considerable sums of real money, players could face significant financial loss if their accounts are hacked or if they fall victim to scammers.

Those risks have increased as the value of gaming assets has risen, according to the CFPB. But players may have limited resources as traditional banking and payment system protections do not apply.

“In complaints to the (Federal Trade Commission) and CFPB, several players reported hacking attempts, account takeovers, scams, unauthorized transactions, and loss of access to in-game currencies and virtual items, but received limited remedies from the companies. games,” the office wrote. . Gaming companies often put “the burden on individual players to avoid these scams and phishing attempts.”

Boy plays the video game Fortnite

The CFPB warned that many video games collect a huge amount of data, a fact that parents of young players may not be aware of. (Frazer Harrison/Getty Images)

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Meanwhile, publishers can also collect important information about their users, including location data, social media data, and behavioral interactions, “such as how a player responds to personalized incentives,” according to the CFPB report.

“There is a risk that gamers will be harmed when their data is sold, bought and traded between companies, even for non-gaming purposes,” the report continues. “Furthermore, the vast accumulation of consumer data collected by gaming companies raises questions about whether privacy regulations are being respected and whether consumers, especially young people and their parents, are fully aware of how their data is collected and used. data worldwide. industry.”

Ultimately, the CFPB did not indicate that it was taking action against the video game industrynoting instead that he is “monitoring” the situation.

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