Electronics

YouTubers Who Promoted CSGO Gambling Site Without Disclosure Escape Punishment

YouTubers Who Promoted CSGO Gambling Site Without Disclosure Escape Punishment

They cited the CSGOLotto incident as the first case against social media influencers, and their judgment reflected that as they ordered both TmarTn and Syndicate to disclose their business relationships going forward. The videos they created were viewed almost 6 million times, according to the FTC, but they never adequately disclosed their connection to CSGOLotto.

According to the settlement order by the FTC, TmarTn and Syndicate are required to "clearly and conspicuously disclose connections with an endorser or between an endorser and any promoted product or service".

In a prepared statement the FTC Acting Chairman, Maureen Ohlhausen, said that, 'This action, the FTC's first against individual influencers, should send a message that such connections must be clearly disclosed so consumers can make informed purchasing decisions'. The FTC is not disclosing the names of the 21 influencers who received the warning letters.

Here's how the now-defunct, third-party gambling site CSGOLotto worked: CS:GO players who collected cosmetic weapon skins in the game could put up their skins against another gambler's skins, and a digital coin toss would determine who the victor of the whole pot was. The FTC eventually followed suit and investigated Martin and Cassel for using deceptive tactics to endorse the site.

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Since skins are not a legal currency in themselves, the skin gambling industry has not until now been regulated as tightly as traditional casinos and bookmakers. Counter-Strike developer Valve has faced class-action lawsuits because of its previous lack of policing of these sites, with CSGO Lotto being one of the more prominent examples.

Martin is the company's president and Cassell is its vice president. But the FTC had only reached settlements with the companies, raising a question of when-if ever-the agency would directly go after the influencers. Special mention is made of Instagram influencers, with over 90 letters being sent to brands and influencers in April 2017.

Last year, Valve sent cease-and-desist orders to 23 gambling sites after news of the CSGO Lotto scandal broke.

According to the FTC, TmarTn and Syndicate also paid other well-known social media personalities thousands of dollars to promote CSGOLotto on multiple platforms, such as YouTube, Twitch, Twitter, and Facebook. The FTC clearly don't have the regulatory muscle to deal with this "new" form of gambling, and U.S. gambling regulation is also failing to adapt quickly enough to this development.


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