OK so this is the email I just sent to my contact at the FTC - she is a Commissioner so is in the perfect position to offer a really solid legal opinion on this.
I have been reading some research regarding “Games of Chance” in mobile games which have In App Purchases tied to them and I was hoping you might be able to provide some perspective from the FTC.
The game in question is a car racing game and it is free to download those who do not spend real money on “In App Purchases” (in this case Gold Bars) are restricted to how many races they can play by a number of tickets which refresh over a period of time. Gold bars can be used to refresh those tickets much faster and the more “In App Purchases” you make the higher your VIP status becomes which gives you more race tickets than lower level VIP users & non-VIP users (you can only become a VIP by making “In App Purchases”).
Now at the end of each race there is a mini-game which is represented as a game of chance – there are three rewards which are flipped over (like cards) and their position is randomised so when you pick a card you win one of the rewards – rewards vary from in game cash (not Gold Bars), various modules to upgrade your cars and visual style points for changing the cosmetic appearance of your car.
These mini-games are represented as games of chance and users are led to believe that the cards are mixed into a random order and that they have a chance of winning any of the three rewards. However, research has shown that the rewards are in fact fixed and that no matter which card you select you will always win the same reward for the same race. The research which proves this saved the game directly before a race and then completed the race before selecting a card in the mini game, made a note of the prize then reloaded the saved game to do the same race again. Every single time the game was reloaded, the researcher received the same reward every single time irrespective of the card they chose. This research was repeated for multiple races to ensure that it was not a bug and indeed the same behaviour was found for every single race tested – races were tested in excess of 20 times per race using the same save game file before starting each instance of the race.
It seems to me that there could be several legal issues with this situation.
First and foremost, many consumers purchase gold bars for real money so they can complete more races and improve their cars faster so they can gain higher results in competitions. The developer of the game is intentionally misleading those paying customers by making them believe the mini games (which are a very important part of the game, they are the main way you upgrade your cars) are games of chance when in fact they have a predetermined outcome and the player does not have a chance of winning any of the three displayed rewards, only the reward which has been pre-determined. So it is my opinion the developer would be in breach of FTC rules because they are misleading consumers.
Secondly, as far as I am aware (and this is certainly the case in Europe) games of chance must actually be games of chance – that being they must provide the player the opportunity of winning any of the described rewards/prizes. It is a fundamental and underlying principle of gambling regulations. So it is my belief that the developer may also be in breach of gambling regulations as well.
Finally, it is my belief that if the developer leads the player to believe that they have a real chance of winning something they actually have no chance of winning and the developer is making revenues from this (In App Purchases) they are potentially guilty of fraud because they are obtaining moneys by deception.
I would really value you thoughts on this issue and if they echo my concerns I will be filing an official complaint with the full details to your office.
