Kickstarter Doesn't Really Care If You Get Scammed Out Of $25

Worried about Kickstarter not caring if one of its projects steals your money? Well... you probably should be.

According to Sunny Bates, advisor-slash-board member for the crowdfunding website, if you give your money to a project that project gets funded, and you then get ripped off, you'll be left to fend for yourself.

"Here's the deal," she said to Polygon. "It's one thing to be scammed like Bernie Madoff, where you've gone and you've been seduced by something and put in all your life savings. It's another thing for something not to come through for $US25."

Right. Because if you're not losing 10 grand, who cares?

Kickstarter has grown immensely popular within the gaming community over the past few months, following the monumental success of designer Tim Schafer's adventure game project earlier this year. Plenty of game-makers have sought to bring their own ideas to fruition by begging the internet for money.

Among the many problems that have sprung from this trend, perhaps the biggest is that Kickstarter has no safeguards in place to prevent somebody from, say, creating a complete scam and stealing all of your money.

But Bates says Kickstarter isn't a business; it's a "platform".

"You know what I mean?" Bates said. "When it's syndicated out so broadly with backers, even if somebody is scammed -- and it looks too good to be true and you still take a risk on it anyhow -- you feel pissed off and upset at the creator and then, you know, some of that may lead over on some people feeling 'why can't Kickstarter control this?' Well, it's a platform -- we can't."

So you might never get the reward you're promised. The video game you fund might never be finished. Every time you tell your friends about a Kickstarter project, you could be helping someone run a Ponzi scheme.

Bates went on:

I think that because where the bulk of the projects are is between the $US25 to $US1500 range, are you going to go take legal action on something that you put $US50 into? I mean you tell me. Maybe if you put $US10,000, sure. Or $US1000, maybe. But if you lost $US25 or $US50 then you're a little disappointed and you think the [project creator] sucks. But that's the beauty of crowdsourcing, it's not really worth your effort - you're disappointed and you're angry that somebody would do this because it does feel like they're duplicitous and they're trying to pull the wool over the crowd's eyes, and clearly they can't. But I think legal action, when you syndicate it out and you have hundreds of backers for any one project, it's a very different story.

While we've seen plenty of Kickstarter-funded games turn into tangible projects, these comments are certainly something to consider the next time you decide to give your money to a crowd-funding operation. And it's certainly unfortunate that every Kickstarter project has to be a gamble. Even if it is "only $US25."

Why Kickstarter 'can't' and won't protect backers once a project is funded [The Verge]

Photo: RT Design Studio/Shutterstock


    Sounds like a cop-out to me.

    can't control your OWN PLATFORM, then what's the goddamn point of making the platform. I haven't actually made a kickstarter, yet, but I'm sure there are T&Cs to agree to actually make the project if funding is attained.

    Also, from the sound of it, the public donates and Kickstarter holds the funding until the full amount is reached, then Kickstarter pays the creator. Then legally Kickstarter is the funder and the users who donated are just that, donators. That being said, Kickstarter could then pursue the scammers with legal action and pay back the users the amount they are owed.

    So yes, it's not worth a single user for $25, but it is worth Kickstarter pursuing $15,000 on behalf of 600 users.

      No, actually, Amazon handles the payments and no money is deducted from funders until (or if) the target is met. Kickstarter itself is just a platform.

      I do agree that they should be way more strict with projects to weed out scams, the answers they gave above seem lazy - particularly when there's nothing stopping people making fictional companies that look real enough to attract money.

        Okay so Amazon holds the funding for Kickstarter, this would still allow Kickstarter to contact Amazon and have them represent the users. All it really does is change Kickstarter to middle man.

        I realise that this can be expensive, trust me I deal with solicitors all day every day, but all it would take is Kickstarter to care about their brand and stop scammers abusing their platform. If they litigated against one scammer, it would send a message to the others not to mess with their platform and, in theory, stop the problem.
        I'm not mad at you Aidan, just mad at Kickstarter for being the defintion of a lazy company

          But then you start getting into kickstarter having to do due diligence on every project and having to take a much larger chunk of money for each project.
          It starts sounding like the argument that because google provides access to copywrited material then they are liable/responsible to stop people accessing that

            that's a much further argument when this initial discussion becomes too in depth. Google cannot control what appears on the internet. They already choose not to include auto-complete for adult content and for things like "pirate bay" but they have absolutely no control over what people search for or what people post online. Google, and the public, know that if Google blocked searches entirely that included phrases like "pirate bay", the term will just change "tpb". However Kickstarter have absolute control over what appears on their website, they can take down anything at any time. If they are going to be a platform and actually take money from people posting on their site, they need to monitor it. If they were a platform like Google and charged nothing to use their site, people would be scammed because of their own stupidity. Since Kickstarter charge something to the creator, they are making themselves an authority and giving their own "guarantee" that the ads on their site are actually factual and not scam artists.

            "But then you start getting into kickstarter having to do due diligence on every project and having to take a much larger chunk of money for each project." Due diligence, so basically what they are required to do? I see what you are saying that this will be less cost effective, but if they are making money from people like this, they need to do their damn job and make sure the ads are legit

      No they don't. Because just having the funding doesn't mean the project will succeed. If you go down the wrong path spending money on an avenue that you think will yield good results. Then you realize that what you've achieved is unusable in the final product. Without a way to get more funding to cover the deficit you just created your pretty much screwed.

      Unless they are a scammer it's in the best interest of the person to actually deliver the project since logically they think they will make more money long term anyways

        This is entirely different and getting the funding is not the problem, nor is people who fail because they made a mistake. The issue, at least in my eyes, is that Kickstarter aren't doing their job and vetting out scammers. If you donate and the project fails that's different than there was never a project to begin with. Failed projects cannot be forseen, if they could, it wouldn't matter, however scammers can be caught out with proper work, not just another Craigslist.

    I agree with Bates to be honest. You are making an investment. investments sometimes dont pay out. Its like investing in stocks. You can often tell however how serious someone is about following through with their kickstarter idea by the effort they put into their campaign. the risk is left to you to assess. On the other side of the fence, id be pissed if someone got funded then ran off with my money, but as long as they legitimately try to realise their project, it wouldnt matter to me if it never eventuates.

      It's not an investment. It's a donation or at best a pre-order on something that may or may not come out.

        If it's a Donation. Then it really doesn't matter what the guy does with it does it.

        You donated the money. If your saying it's not an investment then they have no obligation to do anything with that obligation(And if it was an investment they sometimes fail)

        People donate money to all charities and most of those charities take a cut off the top before it even get's to the relevant people they support.

    So he's basically saying Caveat Emptor.
    Fair enough.

    I totally understand what this guy is saying and so should everyone. However, his phrasing is terrible patronizing and dismissive and he almost appears to encourage scamming because "c'mon, who's gonna bother to recover measly $25?" If he had ended his statement with "and we're all grown up boys and not little bitches that cannot forgo the value of a couple meals at White Castle, aren't we?" he wouldn't have sounded any more patronizing.

    Guy needs PR classes.

    You could kickstart it and the game turns out completely crap or different than you expected. Not going to get any money back then and no sympathy. Investors beware.

    *shakes head*

    The title of this article is incredibly misleading. How could Kickstarter possibly determine what projects are scams? How is Kickstarter supposed to guarantee projects when:

    - Projects fail - The good projects, even the well presented ones, still have a chance of failure - are they "scams" if the project fails and users get nothing?
    - Projects can get delayed - how would Kickstarter definitively know if a project is a scam versus a project that has been delayed?
    - Projects can have original content and still be scams - how could Kickstarter possibly tell the difference between failed and scam projects in cases like this?

    As others have said, you invest in the project, there's no guarantee you'll see a return. Its up to the user to determine the projects that looks likely to make a return by researching a project before its backed.

    I also agree with Kickstarter here. It's nice to think that donators can pay their money in full safety and get exactly what they expect in a timely manner - but it's not going to happen in every instance. If that's what you expect, then wait for the final product to emerge and pay for it then.

    People investing in a potential product should be doing their own due diligence on the product and its creator. Having a middle man like Kickstarter doesn't magically remove this responsibility. If there's any doubt about the project, either pay a small enough amount that you're willing to lose it, or avoid it.

    I've personally only used Kickstarter to chip in $20 for the Double Fine Adventure because I figured that these people have a proven track record of past projects, and their reputation riding on the success of this project.

    Of course they'll have this attitude. Until the first class action lawsuit against them. When people invest and become stakeholders and aren't covered properly incase of scams, there's definitely room for legal action. I know many of you will jump to Kickstarters defence screaming 'NO THERES NOT! BUYER BEWARE!' but in real life, outside the intarwebs, there are safeguards in place for stakeholders investing in companies incase of scams, even investing in proposals and projects. If a project doesn't see fruition due to a legitimate reason, so be it. If it's because it's a scam and the parent company doesn't make any effort to recoup, then there is by all means, a liability on the parent companies behalf.

      Yeah - I'm pretty sure they are about to get hammered. As soon as they took a cut, it stopped being just a platform, and started being a paid service. That service isn't providing any basic safeguards, even against obvious scams.

        Yeah, it's like when you /buy/ a newspaper and you get scammed by one of the ads in it. You definitely can and should sue the newspaper, right?

          Yeah, except a news paper doesn't get a cut of the ill-gotten gains - there's a one-off, up-front payment. Also, newspapers are expected to remove fraudulent advertisements - kickstarter is doing any degree of checking.

      ...except that the parent company is the one offering the project, not Kickstarter. And you can indeed try to go after them, but as they mention above, who's going to bother for $25?

      It all comes to being a slightly flawed model, really. Kickstarter makes it really easy for lots of people to donate small amounts of money adding up to a large amount. This is great when it makes it possible for a project to get off the ground without needing large risk-averse investors. But it's not so good when a scammer/slacker can use the same mechanism without giving anything in return.

      I guess Kickstarter could require more detailed investment documentation from the projects, but ultimately they're not the ones making the decision anyway. It always comes back to the people investing. And people (me included) are dumb :)

        Class action. A law firm will go after them on behalf of a large number of donators. Public comments like this will make it an easy win too I expect.

    I agree, invest at your own risk but talking like this is fucking stupid and whoever handles PR or marketing would be facepalming right now. Scams will hurt the reputation of Kickstarter and having this "Meh lol you took the risk" approach is fucking stupid, they're a company, they dont actually have to care, only pretend to.

    The fact of the matter is that we are already getting scammed by paying $60 - $100 on existing games and only being able to trade them in for a fraction of that if the game is a dud, even though it comes from a prestigious series (Eg. Final Fantasy 13 etc.) So that is in effect a scam. And with the big publishers wanting to change over to a "cloud" network where we are forced to pay for a digital copy that we cant even "trade in" if the game blows then we are guarenteed to be scammed without a chance of getting any money back.

    With kickstarter if they scam once, they are blacklisted and wont be able to scam again. Plus genuine companies who deliver will garner an enormous amount of support for future projects. Kickstarter may not be the perfect way of delivering new IP's but i think it is certainly in the right direction. Why? Because gamers will have to inform themselves as to who are legitimate developers instead of being sucked in by marketing that promises something that doesnt get delivered (Looking at you Peter Molyneux)

      So games that you can read up on, watch videos, read reviews/impressions and pay $20-$100 for a tangible product that exists now are scams.
      But games that you can't do anything but pay $5-$X for an idea and pitch that may or may not get finished and may or may not even be a quality product sounds like the right direction?


    I look at this like a dude approaching me on the street. If the idea is good enough for me to give money to a bloke that I just met that started a conversation with me at a party or whatever, then i pay. I only invest small amounts and if I lose $20 because the project failed, as many of these upstarts may indeed do, or its a scam or whatever, then so be it. That's exactly what you sign up for. The early investors in upstarts don't only take the benefits that come with it, you also accept your fair share of risk.

    And thats why I haven't nor will I ever give to any kickstarter fund.

    Look forward to more disclaimers..
    A legitimate start up/prospective project will start to mention that investments cannot be guaranteed.
    ie: Bonus giveaways etc as part of "early donation" may only be sent if project reaches a certain milestone.

    I think Kickstarter probably need to do something, especially as the value gets over a pre-determined amount. You can bet they are holding insurance against this sort of litigation.

    Kickstarter is focused on creative projects. We're a great way for artists, filmmakers, musicians, designers, writers, illustrators, explorers, curators, performers, and others to bring their projects, events, and dreams to life.

    That is what kickstarter does, it is a way to fund things. When everybody is talking about investing that isn't actually what kickstarter does, they are collecting funding/donations on behalf of creative individuals. That person may choose to offer a reward for this (generally they do) but you are not investing in the project.

    This is literally why we cannot have good things. Kickstarter is a great thing. it has allowed hundreds of creators, innovators and inventors to both be funded and reach a wider audience, cutting greedy middle-men and imposing corporate restrictions. Most of them have delivered to the satisfaction of their funders and most will in the future.

    However, there's bad people. A sad constant of our world but one that always seems to take people by surprise generating waves of panic and/or anger. The bad people is often, just a tiny minority; however, their actions impact negatively a lot of people . Then we get all the complains of shock, frustration and the demands for someone to pay, someone's head to roll; even if (and more often it's the case) the head is not that of the bad person.

    Obviously, no one wants to lose their heads, so after the few first complaints, strict policies enter the game and are made stricter as the ones involved keep figuring the never-ending loop-holes that bad people will always find to get away. Paranoia, mutual resentment and cold, bureaucratic legality take the place of trust, enthusiasm and good and the whole world becomes a bit uglier: Creators will have to meet the increasing demand of the public for legitimacy, as well to the requirements of the 200-pages-of-tiny-print-legalese agreement Kickstarter will have to produce to cover all its bases to the point they will be no much different from what they'd have to do taking the middle-men corporate way. On the other hand, the public becomes wary, jaded, tired of the increasingly bureaucracy and stingy.

    All this could be avoided if people understood that 1.) There's bad people out there, not many but they exist, and 2.) It falls to you to keep yourself well informed, do your research and carefully measure the risks before doing an investment. Also, understand that there's a /risk/ and make sure that you can deal with unexpected outcomes.

    Haha, who am I fooling? Any time now some dumb kid will donate $100 to "Zega" to release their long awaited "Zonic 5" and when the whole thing goes belly up, his enraged soccer mother will rally a lot of other soccer mothers to sue KS for $100000000000. The rest is history.

    If a store rips you off you don't blame the shopping centre

    She has a pretty cavalier attitude about this. That's going to come back to haunt them.

    If you look at individuals and individual projects, no, people aren't going to small claims court to recover $25 but they do when it gets into the hundreds.

    But what happens when enough people are ripped off to mount a class action suit?

    It's a trip how tech people want to do anything they can that can be done but when it f*cks people over suddenly all they can say is that it's out of their hands. Kind of like gun nuts and the businesses that serve them.

Join the discussion!

Trending Stories Right Now