Roblox Corp facing class action complaint over child gambling allegations

Roblox Corp. has been hit with a class action complaint and accused of participating in an illegal gambling ring involving children.

As highlighted by Bloomberg Law, the complaint was filed by Rachel Colvin and Danielle Sass in the U.S. District Court for the Northern District of California last week.

Colvin and Sass claim their children have been using third-party gambling websites to place bets using Robux, the in-game currency used in Roblox, and have lost money as a result.

They claim that Roblox has illegally profited from minors' gambling and has therefore violated the Racketeer Influences and Corrupt Organizations Act.

The complaint states that Robux has real-world value and is being used by children "who previously could not access the funds to participate in online gambling" to do precisely that.

It also notes that Roblox's terms of service prohibit "experiences that include simulated gambling, including playing with virtual chips, simulated betting, or exchanging real money, Robux, or in-experience items of value."

Colvin and Sass claim that statement is misleading because Robux is now being used by third-party gambling websites as an acceptable form of currency.

In a statement sent to Bloomberg Law, Roblox Corp. said that third-party gambling sites have "no legal affiliation to Roblox whatsoever."

"Bad actors make illegal use of Roblox's intellectual property and branding to operate such sites in violation of our standards," said the company, which added that it will "continue to be vigilant" and fight those who "endanger the safety" of its community.

Roblox 30 percent fee thickens the plot

The complaint, however, alleges that Roblox Corp. is actually "significantly enriched" by the practice because it charges a 30 percent fee when those gambling websites convert the Robux won from minors back into dollars, allowing it to earn "millions in annual cash fees."

It also suggests Roblox is capable of tracking the electronic transfers made on third-party gambling sites because many of those casinos allow users to link their Robux wallet to the platform.

"Roblox knows its Robux are being used to place bets in illegal virtual casinos, directly facilitates this transfer within the Roblox ecosystem, then imposes a fee on the ill-gotten gains accrued by the Gambling Website Defendants when they seek to convert Robux to cash," reads the complaint.

"Plaintiffs’ minor children—like hundreds of thousands of others across the United States—fell prey to this illegal scheme and were victimized out of real money. As a result, the Gambling Website Defendants have earned millions off the backs of those too young to legally gamble, all the while providing Roblox with a sizable cut of the money they’ve illegally obtained."

Both Colvin and Sass claim they weren't aware of their children using Robux to gamble and have demanded a trial by jury.