Always disclose. Let me repeat that. Always disclose. It’s really not that hard. The Federal Trade Commission laid out new rules about disclosing sponsorships or endorsements across ‘new media’ last year. Think social media. Twitter, Instagram, YouTube. Those type of sites. It’s why you see “#ad” on Twitter and Instagram. Or, a YouTube description saying “this video is sponsored by so-and-so.”
Two popular YouTubers are finding out what happens when you don’t disclose and get caught. If you’re new to this story, there are two videos you need to watch.
HonorTheCall first brought this story to everyone’s attention back on June 27th.
HonorTheCall’s first video takes a peek at the incorporation documents for CSGO Lotto, a skin gambling website. See, these incorporation documents are in the public domain. Anyone can look at them. What HonorTheCall found was Martin is the website’s President and Cassell is the Vice President.
But it was h3h3Productions’ video on it that blew up.
The case laid out by both videos is damning.
In a video that is now private, Martin claims “this is something that has never been a secret.”
Yet in his own videos, Martin says stuff like:
“We found this new site called CSGO Lotto, so I’ll link it down in the description if you guys want to check it out. We were betting on it today and I won a pot of like $69 or something like that, so it was a pretty small pot, but it was like the coolest feeling ever. I ended up following them [CSGO Lotto] on Twitter and stuff, and they hit me up and they’re talking to me about potentially doing like a skin sponsorship.”
Remember, this guy owns the website he’s talking about. Strange way of talking about something you own.
Cassell took to Twitter and said, “I’ve always disclosed that my CSGO videos were sponsored & even asked a YouTube employee if anything more was needed & they said it wasn’t.”
This isn’t Cassell’s first problem with disclosing. Here’s an article highlighting his failure to disclose financial ties to Dead Realm, a game he promoted on his YouTube channel.
Not disclosing a site you are promoting is illegal according to the new rules I mentioned above by the FTC. It looks even more shady when said site is one you actually own. Add in the gambling aspect, and many folks are speculating about the potential for outcomes to be rigged.
Still having a hard time wrapping your head around this? A Bloomberg article from April highlights just how big virtual skin gambling is in CSGO. The report cites one estimate that “more than 3 million people wagered $2.3 billion worth of skins on the outcome of e-sports matches in 2015.”
And that’s just e-sports matches. Skins are changing hands every day on sites like CSGO Lotto.
This is just the latest in an industry that is coming under a lot of heat in recent weeks. Late last month, a lawsuit was filed against Valve claiming they “knowingly allowed … and has been complicit in creating, sustaining and facilitating [a] market” that is akin to online gambling.
We’re still waiting on an official statement from Martin and Cassell. And more importantly, Valve. It’s going to be interesting to hear Valve’s take on this situation. The company is known for operating on ‘Valve’ time (aka, slow as hell). It’s time they come out and address CSGO gambling now.