News

Christopher Ballod Quoted by Legaltech News on Money Laundering in Video Games

Philadelphia, Penn. (November 11, 2019) – Cybersecurity Partner Christopher Ballod was recently quoted by Legaltech news for an article examining the legal issues faced by the producers of video games that use in-game currency systems. The publication reached out to Mr. Ballod for their article, “Money Laundering on Video Games: Play On or Game Over?,” because of his experience working on anti-money laundering (AML) policies in the video game industry.

Mr. Ballod told Legaltech news that earlier in his career, he drafted AML policies for video game companies to insert into their terms of service. Such user agreements, along with direct action taken by the companies to address problematic users and accounts, usually provide enough legal protection.

“They can’t control everything. That’s not possible,” Mr. Ballod said. “So if they’ve taken those reasonable steps, they’ve limited their liability through terms of service. There’s not a whole lot of cause of action against them.”

Mr. Ballod also noted that many of these game platforms have age limits, so even if a suit were to be brought under the Children’s Online Privacy Protection Act (COPPA), it’s likely the player was using a parent’s credit card for any in-game transactions, nullifying a COPPA claim.

“If the parent has consented by providing a credit card, you don’t have a COPPA violation,” said Mr. Ballod.

Mr. Ballod also acknowledged that there are occasions when video game platforms have been used to send virtual money overseas (“Believe it or not, I’ve seen legitimate uses for virtual currency like that”), which complicates matters. Regardless, he believes that regulators may not be prioritizing this issue in the face of more pressing financial regulatory matters.

“Bitcoin is keeping everybody so busy,” said Mr. Ballod, “this might be lower down on their radar.”

Mr. Ballod is a partner in Lewis Brisbois’ Philadelphia and Pittsburgh offices. He is a regular contributor to the firm’s Data Privacy & Cybersecurity blog, Digital Insights, and a frequent commenter on the intersection of social media, cybersecurity, and the law.

Read the full article here (subscription may be required).

Related Attorneys