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Valve Threatens Counter Strike Gambling Sites (hngn.com)

An anonymous Slashdot reader quotes a report from HNGN: Game maker Valve is threatening to shut down sites dedicated to gambling with add-ons to its popular Counter Strike game. On Thursday the company sent cease and desist letters to 23 sites, demanding that gambling operations be stopped, and that the sites had 10 days to comply. The row revolves around the software overlays that change the appearance of the characters people play in Counter Strike: Global Offensive (CSGO) and the weapons and other virtual items. Last week the company reiterated that its user agreements ban external sites from asking users to connect their Steam accounts in order to trade items for real money. The company added that it would use "all available remedies" against sites that did not stop players using virtual goods to gamble.
Bloomberg reports that in June a class action lawsuit was filed against Valve "for its role in the multibillion-dollar gambling economy that has fueled the game's popularity" -- by a man who had been gambling on the site since 2014. This was followed in July by a second class action lawsuit by a mother on behalf of her son, reports ESPN. "The case alleges that the Valve knowingly allows and profits from teenagers participating in illegal, unregulated and underage gambling of in-game cosmetic weapon skins through third-party sites."

37 comments

  1. Think of the children! by LarryRiedel · · Score: 1, Insightful

    Oh it's fine for children to use real money to buy virtual goods, but we must not allow them to gamble with those goods or sell them for real money! Thank you GabeN for thinking of the children!

    1. Re:Think of the children! by ADRA · · Score: 2

      Well, Gambling is almost universally illegal for minors... sooo yes? If they wanted to go legit, they could require mandatory CC authorization for all users. Some minors will have parents shower them with cards, but the majority won't. Problem solved. Next problem, tons of CC's leaked based on DISREPUTABLE gambling sites stealing CC info / CVC's for crime, etc..

      --
      Bye!
    2. Re:Think of the children! by bloodhawk · · Score: 1

      That isn't GabeN thinking of the children, it is the law in most of the world. I imagine there is considerable concern on the legal ramifications.

    3. Re:Think of the children! by Anonymous Coward · · Score: 1

      The problem is most of these sites are scam sites. Some used their acces to the internals to predict the next rolls and got caught on leaked chat logs, others faked hughe winnings on youtube videos while also hiding their affiliation to these sites. Generally the owners of these sites have a history of being scammers and con artists, as is valve only reacted after several of them were exposed for questionable ( read illegal ) behavior.

    4. Re:Think of the children! by Anonymous Coward · · Score: 0

      Lardass is only doing this because of the class action against his company. He's been making several 100 million / year on the back of there illegal gambling sites because it's his store that provides the purchases that are used in bets. Think of it as buying house-tokens in casinos. Ignore their PR spin of misdirection about cashing in, we all know what's going on and Gabe & Co are shitting themselves that even more details are going to leak from the discovery process.

      Legally speaking, people will be going to jail over this. Gabe won't, he's too fucking fat to fit through the doors; but the CSGO SHOUTER MORONS will.

    5. Re:Think of the children! by Antique+Geekmeister · · Score: 2, Insightful

      > The problem is most of these sites are scam sites.

      It's not just "these sites". Must gambling businesses are subtle or outright frauds. Even state lotteries take an enormous cut of the proceeds to fund the lottery bureaucracy itself, and not to help the schools as promised. The schools have their funding _replced_ by lottery winnings, not augmented. Even the "honest casinos" forbid card counters, whose behavior is technically legal but can actually allow players to win in the long run, not just the short run.

      The same problems exist in the stock market. Additional information is forbidden to the ordinary player, but those with additional information can and inevitably do play illicitly. And at the scales available to the larger cheaters, it sucks the possibility of profit right out of the system for ordinary players. Take a very good look at how "high speed trading" works to get a sense of how much of stock market funds are sucked right out of the business by larger companies that can afford the "insider information' that a few microseconds of lead time on stock announcements provides.

    6. Re:Think of the children! by Anonymous Coward · · Score: 0

      I wont deny that gambling is generally balanced against the player, that is basic business for them and with most games the rules are public information available to the player - a game of roulette always favours the house even with red/black bets due to the 0,00 fields and that is well known and unchanging. What the CS:GO gambling sites do is go a step further, they give public rules on how the games work and then bypass chance by using insider information to grab more money with guaranteed to win bets. Further they actively advertise on CS:GO youtube channels with unrealistic win streaks and without making the faked nature of the videos or their afilation clear ( see tmartn, syndicate as owners of csgolotto.com "hey look at this site I found").

    7. Re:Think of the children! by Anonymous Coward · · Score: 0

      IT's the law moron. Go back to school to learn some shit before you spew your incorrect information. Hope you do the same with voting

    8. Re:Think of the children! by vux984 · · Score: 2

      It's not just "these sites".

      These are the bottom feeding scum though.

      Must gambling businesses are subtle or outright frauds

      No, not really. Gambling businesses don't need to cheat or commit fraud to win. That's built into the business. A slot machine in Vegas is a ripoff; but its exactly the ripoff it discloses itself to be. And its independently tested to make sure it pays out exactly the odds it says on the label.

      These gaming gambling sites take all the advantages that are built into being a gambling business... and then they just outright cheat. Rig games for insiders or themselves. Lie outright about the odds. Etc.

      Oh... and they not only let kids play, they market the sites them *directly*.

      At the very least they need to be cleaned up (regulated) so that they rise to the level of legitimate gambling sites.

      Take a very good look at how "high speed trading" works to get a sense of how much of stock market funds are sucked right out of the business by larger companies that can afford the "insider information' that a few microseconds of lead time on stock announcements provides.

      That's really a separate discussion. But you are right, and its pretty easy to measure. Every dollar an HFT trader/algorithm extracts in profit is a dollar taken away from the retail buyer and seller. Every single dollar they make is essentially stolen in my opinion.

      But again, nothing to do with gambling in general or steam in particular.

    9. Re: Think of the children! by Anonymous Coward · · Score: 0

      No, you dumb motherfucker. That's a fucking stupid analogy.

      It's like Valve is a hardware store selling paint, and some people use that paint for vandalism. It isn't their fault, and they have no culpability.

    10. Re: Think of the children! by alexgieg · · Score: 1

      It's like Valve is a hardware store selling paint, and some people use that paint for vandalism. It isn't their fault, and they have no culpability.

      In some countries they have. Here in Brazil hardware stores are forbidden from selling spray paint cans to teens, as it's assumed they are going to use them to spray illegal graphiti. If a hardware store is caught selling spray paint cans to teens it pays a fine and runs the risk of being closed.

      --
      Conservatism: (n.) love of the existing evils. Liberalism: (n.) desire to substitute new evils for the existing ones.
    11. Re: Think of the children! by Anonymous Coward · · Score: 0

      The retail investor could invest on ETF stocks if he felt they are unfair. Being first-to-market is only relevant when you have material, previously unknown information. Sometimes that information is the Brexit vote, and ETFs are able to act faster than anyone. On other occasions, the investor does some actual (costly, time-wise) research and figures something out that the market doesn't already know (think the hedge fund in The Big Short) and gets rewarded accordingly.

      Markets are efficient but there are pockets of inefficiency waiting to be found by investors. It's not about just being fastwr or timing it right.

      ETFs provide liquidity to the market and grant investors another tool for diversification which is really the only "sure" way to make money.

    12. Re:Think of the children! by Antique+Geekmeister · · Score: 1

      >> Must gambling businesses are subtle or outright frauds

      > No, not really. Gambling businesses don't need to cheat or commit fraud to win.

      Most, perhaps not all but certainly most, do commit subtle or outright frauds against their clientele. It's not new or even unusual. I've already pointed out the basic funding frauds of the state lotteries. Many of the "scratch ticket" businesses have a fascinating fraud in that they sell the tickets in two boxes. If the vendor sells the big winning ticket in the first box, you make sure to sell the first box to recover your expenses. If the big ticket winner does not show up in the first box, the vendor _throws away the second box, and never pays out the big ticket.

      Even "legitimate" gambling is infamous for being used to launder criminal income. Winning lottery tickets and other gambling tickets are regularly sold off to local organized crime for a fraction of their worth, to provide a favor to organized crime, for the original ticket holder to get some income tax free instead of having it reported by the lottery, and for the organized crime members to claim the winnings and launder their earnings.

      > At the very least they need to be cleaned up (regulated) so that they rise to the level of legitimate gambling sites.

      That level is, unfortunately, very low.

      >> Take a very good look at how "high speed trading" works.

      > But again, nothing to do with gambling in general or steam in particular.

      With steam in particulrar? Only in the sense that they are, in fact, gambling on the stock market and that they cheat, relying on private knowledge not available to the rest of the gamblers. It's self-deluding to claim that high speed trading, or gambling, benefit any economy except possibly the local adult entertainment industries.

    13. Re: Think of the children! by Antique+Geekmeister · · Score: 1

      > Being first-to-market is only relevant when you have material, previously unknown information.

      They have first-yo-mstkry knowledge by a matter of milliseconds, even microseconds, by investing in high speed access to the fiber as it leaves the stock exchange. They then commit transactions while the stock is changing price, before anyone else can possibly respond. That isn't "adding liquidity" by any stretch of fiscal imagination, despite the frequent claims of companies involved in high speed trading. It's arbitrage, and nothing _but_ arbitrage. It's legal, but the extent of its current abuse is stunning.

      to a modest extent, it's also a form of gambling because, if the price rose rather than fell or fell rather than rose, their gambles on investing would fail. Unfortunately, the high speed traders are not being held to account for their unwanted, "failed" bets. They simply cancel those, without noticeable penalty! That's not just gambling. That's gambling where you get to take your money back from the pot if you don't like seeing other players exposed ands, effectively takin gyour money back from the "pot".

      Can an ordinary investor say "I'll sell short by $5", and say, when the stock prices rises, "never mind"? No. They have to actually make the short sale, and lose money for betting wrong. But these high speed traders simply cancel the orders before they exceed the very limited time in which they can do so. It's gambling where they don't have to pay their losses, and very much a form of cheating in the gambling that makes up a healthy stock market.

  2. This could be a good story line for South Park by Anonymous Coward · · Score: 1

    Cartman spends hours gambling on Counter Strike, then after getting bored with the game, sues Valve for causing him emotional trauma and using his "gambling weakness", recovering all the money he lost and getting a chair at the table to use Valve to threaten and extort money from gambling sites.

    Perfect.

  3. Responsibility by jargonburn · · Score: 1

    Might as well check this box off on the "obvious points to cover" list:

    * Without considering whether or not Valve is reasonably at fault, I'm going to go ahead and say that the man who filed the first suit indicated above wasn't winning. Gee whiz, Mom! I didn't know that actions have consequences, and that sometimes, you lose! Again, regardless of whether Valve should be on the hook or not, I doubt he'd have filed suit if he was a better bettor.
    * For the second lawsuit, where the supposed victim is/was a minor, same question: Was he winning? I imagine that to be slightly less a factor, as his parent(s) might be aware that winning streaks can end in tears. However, WHERE WAS HE GETTING THE MONEY? How was he spending it online? Not so hard as it once was, but perhaps they figure that their perfect little angel would never have engaged in such mischief if hadn't corrupted hi pure, innocent heart.

    Sometimes this stuff gets under my skin. I understand that demonstrating you've been harmed by another party is an important step to convincing the courts to intercede (and/or convince another party to make changes BEFORE it goes to court), but that doesn't mean it can't piss me off.

    1. Re:Responsibility by Antique+Geekmeister · · Score: 1

      > I'm going to go ahead and say that the man who filed the first suit indicated above wasn't winning.

      Gamblers don't win in the long run. The house always takes a cut. If they're winning in the long run, they either have knowledge not available to the other gamblers (such as a skilled poker player counting the cards or reading "tells" from the other players), or they're cheating.

    2. Re: Responsibility by BarbaraHudson · · Score: 1

      Anybody can count cards. Despite what casinos say, it's a skill, not a cheat. Hopefully one day a bunch of card counters will do a class action number on the casinos. You should not be discriminated against because you aren't stupid.

      --
      "Transparent" is a shit show that trades on every stereotype going. A man in drag is NOT a transsexual.
    3. Re: Responsibility by Anonymous Coward · · Score: 0

      Poker isn't gambling though. Each hand has an element of chance in the cards dealt, but that evens out in the long run. Hence its classed as a game of skill in many countries (its liable for income tax, not betting taxes here in the uk)

  4. Ofc valve knew, it's why they killed custom skins. by Shadow+of+Eternity · · Score: 2

    They wouldn't be able to make fucktons of money off of cosmetics in TF2 and shitty mspaint reskins in CS:GO if everyone could just hop on FPSBanana and download whatever amazing custom model they wanted.

    --
    A bullet may have your name on it but splash damage is addressed "To whom it may concern."
  5. Valve is likely culpable.... by Anonymous Coward · · Score: 0

    They made a decision a while ago to whitelist most of the gambling sites on the web -- they could have added a captcha or some confirmation step to all the bots that collected skins and acted as the brokers in the game, but instead they not only let them, they helped them do so. Normal users have to confirm every trade so otherwise the gambling sites would not be able to function.

    And to be honest, given their behavior the past few years I have little sympathy for Valve at all... if they get burned for this then I'm going to chuckle, because the reality is that mostly young kids are lured to gamble, and it is from those that Valve makes the most money. They go gamble, lose skins, then buy more keys and try to go again. It's a vicious cycle that Valve loved -- because they were the beneficiary. Now that time has to come to a close and we'll see how the court case ends up.

  6. most mmo games are essentially casinos by Anonymous Coward · · Score: 0

    through rng loot tables (for loot that may trade for cash shop currency or equiv), rng loot boxes (including ones sold in cash shop), equipment enhancement and enchantment rng (with cash shop items to enhance odds of success), 'jackpot' rng events with keys/crates/etc sold in cash shop, etc, etc, etc... and all of this rng is normally without odds of 'winning' published (although sometimes datamined, in violation of eula of course).

  7. Eh? by fubarrr · · Score: 1

    Only Americans can sue each other over games.

    1. Re:Eh? by fustakrakich · · Score: 1

      The lawsuits are the game. Everything else is just props on the set.

      --
      “He’s not deformed, he’s just drunk!”
  8. Wat? by Anonymous Coward · · Score: 0

    "illegal, unregulated and underage gambling of in-game cosmetic weapon skins"

    If I fell "victim" to something like that, I'd probably cower in shame and not make it known to the world by suing someone.

  9. Valve built these sites in the first place by Anonymous Coward · · Score: 0

    Notice how Valve's TRADEMARK 'CS:GO' appears in the names of the URLs for these gambling sites? Valve provided the seed money to apparently 'independent' 'owners' to set up the sites, just like the Mob operated casinos in Las Vegas in the bad old days.

    Valve 'charged' the sites massive 'commissions' for use of the trademark, and access to the DRM API that verified the legitimacy of the virtual items. Valve's owner set himself the task of becoming the world's biggest 'Fagin' style crime boss targeting children. Now a little bird has whispered in his ear about his potential fate at the hands of US authorities, so he is deperately truing to tear down the whole enterprise.

    1. Re:Valve built these sites in the first place by Anonymous Coward · · Score: 0

      Do you have a single fact to back that up?

  10. One weapons by aliquis · · Score: 1

    The CS:GO skins doesn't let you change the look of your character (except for the weapon) and no other items than the weapon. CS:GO skins are weapons (with stickers) only.

    Team Fortress 2 mean-while let you change other parts of your character beyond weapons.

  11. Fuck my old reply by aliquis · · Score: 2

    The CS:GO skins doesn't let you change the look of your character (except for the weapon) and no other items than the weapon. CS:GO skins are weapons (with stickers) only.

    Team Fortress 2 mean-while let you change other parts of your character beyond weapons.

    Also Team Fortress 2 alternative weapons / skins / items may actually change how the weapon work. In CS:GO it's all just cosmetic and doesn't influence game-play at all.

    1. Re:Fuck my old reply by Anonymous Coward · · Score: 0

      How is any of this at all relevant to the topic?

    2. Re:Fuck my old reply by aliquis · · Score: 1

      Because the /. story is written by someone who don't know how CS:GO work and make up how he think it works.
      There are only weapon skins in CS:GO. There is nothing else.

      Why just make shit up on the spot? (Then again there is in TF2 and maybe there are TF2 gambling sites too? I don't know why there couldn't be, because there are no pro scene for TF2 right now?)

  12. Re:Ofc valve knew, it's why they killed custom ski by subanark · · Score: 1

    You mean like the penis hat?

  13. State lotteries are scams all around by rsilvergun · · Score: 1

    The money never makes it to the schools. It becomes tax cuts for the wealthy when funding levels are kept more or less the same. John Oliver has a funny and lengthy video on how the scam works.

    --
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  14. Re:Ofc valve knew, it's why they killed custom ski by Scorch_Mechanic · · Score: 1

    What? You've completely missed the point.

    Everyone since the dawn of time has been able to go to websites like FPSBanana (which still loads slow because apparently it's 2004 or something) and download and install every custom skin/model/voice/particle effect they could possibly want. They can still do this. Thousands of people do. The problem is that such modifications are entirely client side, and thus can only ever be for personal satisfaction.

    The point of microtransaction items like "cosmetics in TF2 and shitty mspaint reskins in CS:GO" is for other people to see your fancy hat/weapon. It's to show it off to people other than yourself. Some of it is conspicuous consumption to be sure, but a lot of people like customizing their digital avatars for everyone else to see. That appeal will never disappear. For good or for ill, microtransactions are the lifeblood of many games that millions of people play literally every day. The peak today for DOTA 2 was nearly a million players. League of Legends claims tens of millions of unique players monthly.

    Of course valve shutting down these gambling sites is about money. It's also about gambling, but in reality gambling is about money anyways so... yeah. It's just not about mods like you erroneously seem to think it is.

    --
    You should turn signatures off.
  15. Re:Ofc valve knew, it's why they killed custom ski by Shadow+of+Eternity · · Score: 1

    It's clientside and Valve STILL killed it with forced clientside consistency.

    --
    A bullet may have your name on it but splash damage is addressed "To whom it may concern."
  16. Re:Ofc valve knew, it's why they killed custom ski by Anonymous Coward · · Score: 0

    And for competitive play at least, that makes sense. IMO default models should be enforced for competitive play.

    There are plenty of things you can do that are exploitative with custom skins (hunter orange 3rd person skins, invisible first person skins, long time ago you could even change the flashbang .bmp so it was clear instead of white and make smoke invisible as well).

    Most people just want badass guns, and its cool that others can see your badass guns but if you want to ensure there is no cheating you either have to force default models or restrict them to known custom models.