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CFPB Monitoring Video Games, Virtual Worlds for Consumer Protection Compliance

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The Consumer Financial Protection Bureau (CFPB) is monitoring video games and virtual worlds to ensure their compliance with federal consumer financial protection laws.

This monitoring comes as a growing number of these platforms add banking options and payments, and as the CFPB receives more complaints from consumers, the agency said in a Thursday (April 4) press release.

“Americans of all ages are converting billions of dollars into currencies used on virtual reality and gaming platforms,” CFPB Director Rohit Chopra said in the release. “As more banking and payments activity takes place in video games and virtual worlds, the CFPB is looking at ways to protect consumers from fraud and scams.”

Because games and virtual worlds enable players to store and transfer in-game currencies, virtual items and other valuable assets, their products and services increasingly resemble conventional financial products, according to the release, which includes details about a report on this topic issued Thursday by the CFPB.

However, these companies claim to have no obligation to compensate players for financial losses, the release said. Consumers have told the CFPB that they have little recourse when they suffer losses due to scams, phishing attempts or account thefts.

In addition, gaming companies are assembling large amounts of data on players, per the release. They can gather behavioral details, such as financial data and personal history, and location data. With the advent of virtual- and mixed-reality headsets, gaming firms could also collect biometric data, which raises issues around medical privacy.

Because existing consumer laws apply to banking and payment systems that facilitate the storage and exchange of assets, the CFPB is monitoring video games, virtual worlds and other markets where financial products and services may be offered, the release said.

“The Consumer Financial Protection Bureau is working to understand how these worlds can become a haven for scams, fraud, financial losses and unanticipated purchases that can deplete a family’s real-world financial assets,” Chopra said in a statement released in conjunction with the press release.

Consumers lost a record $10 billion to fraud in 2023, with digital tools making it easier for scammers to find targets, the Federal Trade Commission (FTC) reported in February.

The number of consumers who reported fraud to the FTC in 2023 was about the same as in 2022, but the amount of fraud losses reported was 14% higher, the agency said.