CFPB publishes new report highlighting risks related to financial transactions in video games
The US Consumer Financial Protection Bureau (CFPB) has published a new report highlighting the risks associated with financial transactions within online video games and virtual environments.
CFPB identifies risks to consumers in video gaming marketplaces
Titled Banking in Video Games and Virtual Worlds, the new study reveals that gaming consumers in America spent nearly $57 billion on hardware, software, and in-game transactions in 2023.
Gamers are often exchanging real dollars for virtual currencies or other in-game assets. These holdings are frequently purchased, sold, or traded in online markets that enable gaming organisations to mimic everyday financial transactions online.
The study has uncovered numerous risks related to the surge of in-game assets. Notably, there has been a rise in account thefts, scams, and phishing attempts. The report states that players have “little recourse” with gaming enterprises when they experience losses, as companies often assert that they bear no responsibility to reimburse consumers for financial losses.
This occurs because, unlike traditional financial institutions such as banks and payment services that typically provide consumer protections, gaming providers often prioritise a “buyer beware” stance.
In addition, the CFPB highlights the privacy risks posed through gaming organisations’ ability to collect vast amounts of personal and behavioural data. Gaming companies can now compile information including a player’s purchasing history and spending limits, monitor a user’s locations, and even access a player’s health and medical status.
Consequently, the CFPB warns of the risk that gamers “may be harmed when their data is sold, bought, and traded between companies, including for purposes outside of gameplay”.
The government agency ends its report by asserting that it will continue to “monitor evolving gaming markets” and the “costs and risks” posed to the gaming community.
The CFPB has been particularly active so far this year. Last month, the regulatory body implemented a new ruling aimed at restricting credit card issuers with over one million active accounts in the US from imposing late fees exceeding $8.
