Casinos For Kids: Roblox Accused of Encouraging Online Gambling Among Youth

We wouldn’t let a casino set up outside a playground targeting children, so why do we allow a comparable situation to play out online, parents are asking in a new lawsuit. 

Popular children’s website Roblox is at the center of the legal action, which alleges a criminal conspiracy between the company and three app developers who allegedly allow kids to trade Roblox currency Robux like casino chips on their sites encouraging gambling. 

Inside the lawsuit

Parents, on behalf of their children, have filed the proposed class action lawsuit against Roblox Corp, Satozuki, Studs, and RBLXWild, accusing the companies of violating the Racketeer Influenced and Corrupt Organizations Act (RICO) as well as a range of other consumer protection laws. 

They allege that Roblox and the app developers “maintain and facilitate an illegal gambling ecosystem, targeted at children, through Roblox’s online gaming platform and digital currency,” and the companies are “preying on children nationwide.”

The Robux currency, they argue, is used to accept bets in the app developers’ online casinos, and that Roblox facilitates that by tracking said bets, and completing transactions, allowing Robux to be wagered, and for allowing wagers to be satisfied in the digital casinos. The conspiracy has caused substantial financial loss to many of the children involved, the lawsuit argues. Even when the children get money from the “illegal gambling operation,” Roblox charges a 30 percent fee to transfer the Robux back into cash, meaning Roblox makes millions in annual cash fees for the Roblox casino games, the lawsuit says.

What is Roblox?

Roblox, which was launched in 2006, has grown into one of the most popular websites in the world. CNN calls it a virtual playground, where users can create games in Roblox Studio and play them or play the huge range of other user-created games 

As per the lawsuit, Roblox is the largest kids entertainment website in the world, with 60 million daily active users — 70 percent of whom are younger than 18. Roblox claims more than 75 percent of children in the United States between the ages of 9 and 12 use Roblox monthly. “In its relatively short existence, Roblox has been surrounded by a deluge of negative attention as a dangerous space for children,” the lawsuit alleges. 

Roblox has faced criticism for allowing cyberbullies, scammers, and online predators to misuse the platform, and is even facing a very similar lawsuit over the alleged casino conspiracy. While the company tried to have the lawsuit dismissed, just recently a judge allowed it to proceed. 

In addition to the gambling-related allegations, Roblox has been accused of exploiting child labor and using deceptive advertising practices. Specifically, this separate class action lawsuit challenges how the platform compensates its young user base, who contribute as both players and creators, with Robux, an in-game currency of dubious real-world value. 

How to protect your child online

Keeping kids away from the internet seems an impossible feat these days, but there are a range of steps you can take as a parent to at least ensure their safety online. Education and monitoring is key, and it is important to use parental controls and set rules and boundaries around screen time and app use - especially those that cost money. 

According to the Massachusetts Department of Public Health, kids and teens are more than twice as likely to develop a gambling disorder than adults, which is amplified by their constant bombardment of adverts. Starting a conversation with them young can help stop gambling addiction becoming an issue later in life, the agency says. Research shows once the habit is formed, it’s much harder to break later on. 

The health department suggests modeling healthy gambling behavior at home, and following steps including: 

• Consider your own participation in lotteries or in-person gambling
• Establish clear rules concerning your screen time and exposure to games involving betting
• Ask your child for more information when they want to use your credit to make a purchase
• Keep an eye out for increased interest in competition, your child stashing money, and increased time spent online - especially in secret. 

The plaintiff and proposed class is represented by Michael McShane and Ling Y. Kuang of Audet and Partners LLP.

The Roblox gambling conspiracy proposed class action lawsuit is Gentry, et al. v. Roblox Corp., et al., Case No. 5:23-cv-00883 in the U.S. District Court for the Northern District of California.