'Roblox' at Center of Giant Ring of Illegal Activity, Court Filing Claims

By Ashley Turner

Roblox, a popular video game platform for children, may be linked to money laundering. New court documents claim that over 300 Roblox users are laundering money by purchasing fake in-game goods using in-game currency, according to a proposed settlement filed Tuesday in federal court in San Francisco, per Forbes. "They appear to be using the Roblox platform to send money to one another by purchasing fake items, a highly inefficient and costly means of transferring money, which suggests they may be engaged in money laundering or other improper behavior," the filing states.

It involves the sale of in-game goods between players for Robux, an in-game currency that can be bought with real money. The suit is part of a two-year-old class-action lawsuit against the gaming company. Players claim that Roblox arbitrarily removed in-game items after being purchased, depriving them of the item and their money.

New settlement documents filed by the plaintiff state that some Roblox users will not be eligible to receive the nearly $7.5 million in compensation from Roblox once the case is settled. This is because Roblox disclosed in a new court filing that it determined that the owners of 311 accounts had spent more than $1,000 (80,000 Robux) on items purchased repeatedly by the same buyer and seller or where the buyer and seller were the same. In the filing, they called this "suspicious behavior." Forbes notes that for years, players have laundered money using in-game currencies, such as using stolen credit cards to purchase virtual cash in a video game, then selling that sum at a discount to other players.

William Nevius, a spokesperson for Roblox, noted in a statement that the company disagrees with the characterization of money laundering and will be filing a brief in response. "We have robust controls in place to protect against money laundering, which is not at issue in this lawsuit," he wrote. "These exclusions were necessary because they represent a very specific use case and don't meet the criteria for inclusion in the class settlement."

As Roblox has an in-game economy, users can only sell their Robux to the company when they reach 30,000 (or $375), so Robux can also be bought and sold on a secondary market. Forbes also reported that users, who are mostly children, can scam each other out of items with in-game value that can be sold. Games with similar virtual economies have also witnessed similar scams, including Fortnite. Roblox has declared in previous filings with the Securities and Exchange Commission that the company is "structured" to comply with relevant money laundering and money transmission laws. A Chicago law firm filed the settlement in 2021 for an anonymous girl under 18 who bought items in Roblox from another player. In the lawsuit, Roblox is alleged to act irresponsibly when it arbitrarily deletes items such as accessories, hats, and other virtual clothing after players have sold them because the company decided the item violated its own policies. Roblox itself takes a 30 percent cut every time a good is sold.

The complaint says that when Roblox unilaterally removes an item completely from their game, it leaves the purchaser with nothing. They do not receive any refund or any other form of compensation. The company has disputed this in a statement: "Since 2021, Roblox has had an automated process for crediting Robux to users who, as a result of moderation, lost access to a previously purchased avatar item through no fault of their own."

A settlement agreement was reached without Roblox admitting any wrongdoing. A 36-page settlement proposal, which asks the court to approve a deal between the company and millions of affected users, includes the new disclosure to the San Francisco court, according to Forbes. It is included in a small section of the document that provides a list of boilerplate people who are automatically excluded from the settlement, including the judge and his family. The court is expected to approve the deal in the coming months.

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