First comes YouTube’s half-hearted apology, then comes the lawyers. The CS:GO gaming drama (see below) is now embroiled in a lawsuit involving CS:GO Lotto and Valve.
The lawsuit originally involved Valve, but has now been amended to include CS:GO Lotto (and similar sites CSGO Diamonds and CSGO Lounge) in the Southern District of Florida. The lawsuit states that Valve “knowingly permitted…and was complicit in creating, maintaining and facilitating [a] marketplace “where players and third parties exchange weapon skins like casino chips.” He also alleges that Valve is profiting from these transactions.
“As there is ongoing litigation, no further public comment will be made on this matter. My comments will be contained in the legal arguments in court, at the appropriate time,” an attorney representing the site told Polygon. CSGO Lotto.
Trevor “TmarTn” Martin has posted a vague apology on YouTube regarding his ownership of a CS:GO game site. In it, he brushes off accusations of wrongdoing while seemingly taking the opportunity to show off his dog, his truck (nicely framed through a door), and his giant house. Wondering which one CSGOLotto.com helped fund?
PCGamer contacted attorney Ryan Morrison, who offered this opinion on Martin’s “apology”.
“I can’t say there will be prosecutions, but I’ve said it many times and I still believe it’s as close to a sure thing as you can get,” he said.
“If you look at FanDuel and DraftKings and how many states have sued these guys now, they’re going to see that’s infinitely worse than anything DraftKings and FanDuel did and got similar attention, if not more. I refuse to believe that there isn’t a legislator, a district attorney, a state whatever that isn’t going to make this a criminal case.
Two prominent YouTube stars, ProSyndicate and TmarTn, have been embroiled in an ongoing scandal over the rise of “gambling” with earned weapon skins in the online shooter CS:GO, which have been revealed to be the owners of a gambling site which they have been promoting a lot through their YouTube channels.
The site, CSGOLotto.com, is one of many that allows players to use the skins they’ve unlocked in-game as tokens, assigning them a value based on rarity and opportunity. In many cases, these skins are then wagered against other players, with a slot-like random number generator picking a winner who then keeps the pot. On other sites, the pot is bet against the outcome of other CS:GO games. Keys used to open in-game loot crates must be purchased with real money through Steam, and like skins can be resold through the platform’s trading system and “cashed in” by purchasing games as gifts and selling the codes through various marketplaces, many such operations have already been accused of enabling unregulated real-money gambling, leading to the filing of a class action lawsuit against Valve itself.
“I don’t know why this is being treated as news lol. I enjoyed playing on other sites and saw ways to improve them so I put together a team and created my own site”
It’s not a small industry, nor a new one. A recent Bloomberg report estimated that approximately $2.3 billion worth of skins were wagered on CS:GO-related websites in 2015 alone. Already there have been several calls to investigate the legality of such operations, especially in the United States, where gambling is heavily restricted, especially since many sites do not restrict participation based on age or location, and even those that do are generally in contravenes the laws surrounding real money gambling.
However, the most recent development, uncovered by YouTuber HonorTheCall and promulgated by H3H3 Productions, is that CSGOlotto.com was jointly founded by TmarTn and ProSyndicate, who both released videos with titles such as WINNING BIG $$$ $!!! (CS:GO Betting), showing them using the site and winning huge sums. Not only does this violate YouTube’s interest and payout disclosure guidelines, there is now considerable suspicion regarding the veracity of the pair’s screened bets, with the suggestion emerging that, given their privileged access to back mechanisms -end, both could easily have fixed the results in their favor in order to create more compelling images.
TmarTn has since released a video protesting his innocence, claiming his ownership of the site was never a secret, while simultaneously denying he owned it at the time the video in question was made – although ‘He is listed as the founder who submitted the filing of documents that registered the company in documents uncovered by HonorTheCall. Disclaimers regarding his ownership of the site have now been retroactively added to many of his related videos. He also posted comments on HonorTheCall’s videos, denying accusations of impropriety.
“Yes, I founded CSGOLotto.com,” the comment read. “It’s no secret I don’t know why this is being treated as breaking news lol. I’ve enjoyed playing on other sites and seen ways to improve them so I put together a team and created my own site. Accusing that my earnings on the site and my reactions are fake just because I own part of the site is unjustified. Every game I played was real, every skin I won or lost was real. So please don’t throw around false accusations and slander.”
For its part, ProSyndicate tweeted its apology to anyone who feels “misled” by the situation, promising transparency in the future and denying that anything untoward happened with the betting mechanism itself.
Jas Purewal, digital entertainment lawyer at Purewal, says there is still a lot to be done in terms of clarifying the laws surrounding this kind of situation, but there is certainly legislation that could be enforced.
“Paid/sponsored content and disclosures by YouTubers/streamers are still a legal gray area, but in reality there are enforceable rules and regulators are increasingly likely to respond to potential abuses of those rules, with the UK’s ASA and US FTC leading the way so far,” he said. GamesIndustry.biz. “That said, actually knowing what to do under the different rules can be surprisingly difficult – sometimes because they say different things, sometimes because we don’t yet have the cases decided showing what the rules mean or how they work. Despite, the general spirit One of these evolving rules is largely that of transparency to consumers, so the more influencers can follow this spirit, the more likely they are to comply with the rules.
“Gambling skins” has not yet been legally tested by any major jurisdiction to my knowledge. In any event, there is no single answer here, as gambling laws vary from country to country (or even state or region to state). There have been suggestions that some gambling regulators may consider it regulated gambling, but nothing official. What we can say is that in general terms online gambling is heavily regulated in most countries, and in some is outright illegal, so any online service that is required to be online gambling would have quite extensive legal requirements – which could range from having to obtain a gambling license (in the UK) to being prohibited and even potentially treated as a criminal matter (in the US and parts of Europe mainland).”
As of July 1, a notification on the CSGOLotto site warned of service “disruptions” and attempting to connect to the site via Steam returned a message saying “The URL you are trying to connect to has been blocked by our moderators and our staff. This site may be involved in “phishing, scamming, spamming or distributing malware”, but users continue doing so at their own risk. However, this has now been removed.
H3H3’s full summary of the events leading up to the recent developments, which is a great primer for anyone who hasn’t been following the case, can be found below. Strong language throughout.