CFPB Warns of Hidden Financial Risks in Video Game Markets

The CFPB warned that gaming companies "use underhanded tactics to encourage spending, which can lead to unexpected charges on your debit card, credit card, or mobile payment service."

In a Consumer Advisory, the CFPB asserted that the video gaming industry lacked consumer protections and posed risks to consumers, particularly children and young adults. (See previous coverage.) The CFPB said the design of many video games is deliberately deceptive, utilizing in-game currencies with confusing exchange rates and gambling-like mechanics, such as loot boxes, to encourage compulsive spending. The agency warned that these practices often result in unexpected charges on credit or debit cards linked to gaming accounts, which can be difficult for consumers to dispute or recover.

Further, the CFPB warned that gaming companies frequently provide inadequate customer support when financial harm occurs. They said that players—often minors—may lose substantial amounts of money due to scams, unauthorized transactions, or account theft, with little to no recourse from the gaming companies involved. The CFPB also highlighted privacy concerns, noting that gaming companies often collect extensive data on players, including behavioral and biometric data. 

The CFPB recommended that consumers take several precautions, such as using gift cards instead of credit cards for gaming purchases, enabling parental controls, choosing games without in-game purchases and opting out of data sharing when possible.