YouTubers Exposed For Promoting Their Own CS:GO Gambling Website

Virtual items, or skins, are big business these days. People buy, trade and gamble this stuff like candy: not in small amounts, but to the tune of billions of dollars per year.

But while the business of skin trading and gambling has become enormous, the protections and regulation around it has yet to catch up. So there's a lot of room for untoward behaviour. And that's what two YouTubers have found themselves in the community's crosshairs for: promoting a Counter-Strike: Global Offensive skin gambling website, without fully disclosing their ownership in the business.

Image: Supplied/CSGOLotto.com

Everything centres around two Youtubers: Thomas "ProSyndicate" Cassell and Trevor "TmarTn" Martin. If the names ring a bell, here's a quick breakdown of why they matter: Cassell was the first person to reach a million subscribers on Twitch, while Martin has more than 5 million subscribers across his TmarTn and TmarTn2 YouTube channels.

Late last week, a small YouTube channel by the name of HonorTheCall uploaded a video showing a range of business entries naming Cassell and Martin as having co-ownership of the skin gambling website, CSGOLotto.com. The site had previously featured in Cassell and Martin's YouTube videos as somewhere they could go to bet, but it was never expressly outlined that they were had any equity in the company, or that they were members of the board.

Here's a screenshot of the description from one of Martin's videos showing how the site had been advertised.

"Best place to bet skins" isn't the same as "here's a link to a gambling website that I own". HonorTheCall below goes through a number of filings showing Martin and Cassell as principals and directors of CSGOLotto below, or you can click on these StateLog and InterCredit Report listings.

Things didn't really blow up until it caught the attention of the h3h3Productions channel, which has more than 1.5 million subscribers. They jumped on board the scandal, and put the same questions to Cassell and Martin: how could they promote a gambling website that they partly owned, without expressly disclosing that fact?

Cassell and Martin refuted claims that they were not upfront about their ownership of the company. A number of Cassell's videos have the line "this video is sponsored by CSGO Lotto", and Cassell stressed as much on Twitter.

The United States Federal Trade Commission's guidelines say that "as long as the audience knows the nature" of the relationship between a content creator and someone endorsing a product, they're in the clear. Here's some relevant questions from the FTC:

When should I say more than that I got a product for free? It depends on what else (if anything) you received from the company.
For example, if an app developer gave you their 99-cent app for free in order for you to review it, that might not have much effect on the weight that readers give to your review. But if the app developer also gave you $100, that would have a much greater effect on the credibility of your review. So a disclosure that simply said you got the app for free wouldn’t be good enough.
Similarly, if a company gave you a $50 gift card to give away to one of your readers and a second $50 gift card to keep for yourself, it wouldn’t be good enough to only say that the company gave you a gift card to give away.
... Are you saying that I need to list the details of everything I get from a company for reviewing a product?
No. As long as your audience knows the nature of your relationship, it’s good enough. So whether you got $50 or $1,000 you could simply say you were “paid.” (That wouldn’t be good enough, however, if you’re an employee or co-owner.)

After the scandal broke, footage emerged of TmarTn being logged into Steam under the account "csgolottobot5" (highlighted in red), while he was betting on CSGO Lotto.

Image: Supplied

Another person listed on one of the business listings is Josh Beaver, who streams and uploads videos under the account JoshOG. Previous videos mention CSGOLotto as one of his sponsors, but not all of them. At the time of writing, a video uploaded on February 11 (US time) shows Beaver betting thousands of dollars worth of skins, with only a link to CSGOLotto in the description.

Social media put the question to Beaver about failing to properly disclose his ownership in the business. He responded during a livestream that he was one of the first users to be "sponsored" by CSGOLotto.

"Like I said, i was the first sponsorship that CSGOLotto acquired and when it comes to start-up, especially a start-up, it's not uncommon for a sponsorship to ask equity of a company, so. That's not uncommon at all. And you actually find out that a lot of streamers have equity in some of these websites. Or you used to."

The broadcast has since been deleted from Twitch, but segments of the livestream have been reuploaded on various websites.

"I'm listed as secretary on there because I do have equity stake, and they have to put me as something, they have to label me as something, so I'm the secretary," Beaver went on to say. "That's pretty much it. There's no way for me to explain it any more, to be honest. That's pretty much what it comes down to. But as far as any shady shit that went down, I was not involved with any of that. I don't even think any shady shit went down."

The scandal has ramifications outside of YouTube, however. As it turns out, Martin is a co-owner of the professional esports organisation EnVyUs. Mike Rufail and Tyler Thompson, the managing partners and co-owners of the team, published a statement overnight saying that "we gave a small amount of equity" in the team to Martin "in return for his advisement and support of our video content on the YouTube network".

"As a company and as managing partners, we have absolutely no involvement with or ties to CSGOLotto.com," the EnVyUs partners wrote. "Recently, a few of our CSGO players have been offered sponsorship with CSGOLotto.com among many other lottery driven or skin marketplace type web destinations on an individual basis. Our organisation does not manage those relationships and have advised our players to avoid further relationships with any company that may be deemed as negligent by the vocal community."

Martin previously listed himself as a co-owner of EnVyUs on his Twitter profile, but at the time of writing that has been removed. He also wrote on social media that he had publicly admitted wishing he was "more upfront about owning the site" but that he was never outspoken about his position in the business.

"My idea was to keep business business, while the focus of YouTube was simply making entertaining content," Martin said via Twitter, which has since been deleted. "Obviously that was misleading to viewers and something I very much regret. I've never been perfect and I 100% own up to that mistake."

It's not the first time that streamers have been exposed for their relationship towards skin betting or gambling sites. Recently, popular streamer and CS:GO analyst Mohamad "moE" Assad exposed evidence showing that the gambling website CSGO Diamonds had shared the results of bets with him before they had taken place.

Assad intended to force the website to pay him money that the site allegedly owed, but the ploy massively backfired. Further evidence later emerged that Assad was given "house money" to bet with and was never at any real risk of winning, as the owners of the website would top up his account whenever it ran dry. The streamer and analyst then later told Richard Lewis in an interview that he received more than $US90,000 from the website in partnership fees, with a further $US300,000 from affiliate referrals from the beginning of this year.

Martin has said over Twitter that he will publish a statement by tomorrow Australian time. I've reached out to Martin, Cassell and Beaver for comment, but did not receive a reply by the time of publication.


Note: Analysts Eilers & Krejcik Gaming and Narus Advisers estimated that the total value of items wagered on skin betting sites this year was $US7.4 billion. A copy of their latest annual report was provided to Kotaku Australia.


Comments

    Terrible. How dare these garbage human beings at h3h3productions start a witch hunt against the fine people at CSGOlotto.

      Do the people downvoting you get the fact that you're deliberately pulling their strings?

        That's the whole point of trolling isn't it? :P

        Or at least it was before mainstream media took hold of the term and butchered it.

        Yeah, but if I downvoted him it'd be because he's doing a really bad Ken M impression. You have to really be on the ball with the satire to go down that path.

    Actual, legitimately exposed corruption, and a breakdown of ethics in an industry tangential - but also directly related - to video games. This is Youtube's great failing, and once again gaming has to bear the consequences.

    If the burgeoning audiences engaged with the Youtube platform cared more about higher standards and learned that behaviour like this would be considered illegal in most other circumstances, then this would definitely be the tip of the iceberg, surely.

    I'm not sure Valve is completely innocent here though either. Get your house in order, Newell.

      These sites already operate against the Steam Subscriber Agreement, but Valve could make more effort to detect and remove the bot accounts that are used to actually perform the item gifting.

    I don't think Valve is innocent at all. They're the ones that created the marketplace for this sort of behaviour, and there are pretty clear designs comparing their "crate slots" to gambling slots. I've seriously been thinking of just using GOG or buying directly from developers now instead of Steam.

      Valve is almost as untouchable as Blizzard these days, you had better be prepared if you say something bad about Gaben.

      Its crazy that they can just sell gambling to teenagers without any oversight.

      Valve's actions are kind of a side issue here. All sites like this need is something that is not money that is tradeable, and a third party finds valuable enough to exchange for cash. That way they don't fall foul of the US's laws against online gambling. If it wasn't CS weapon skins, it would be something else.

      Now there definitely are problematic aspects with the random reward systems like CSGO crates, where people can end up spending a lot more money than they intend to, but it is also something that isn't limited to Valve. Many free-to-play games have some variant, and you've got the same type of thing in Blizzard's Overwatch. If anything, the trading and market features on Steam probably have a moderating influence on this by giving a market value to the random reward items.

        This is pretty much spot on. The problem isn't the marketplace, it's the ability to gift marketplace items. These gambling sites function by running bot Steam accounts that have the winning items in their inventory, then gift them to the winning account. It would be quite difficult to write code that can detect whether a gift is normal (allowed) or part of an external trade (disallowed), so the options are either to shut down gifting altogether (which nobody wants) or to try to detect and crack down on the bot accounts doing the gifting.

        So while it might be technically true that this problem is a result of systemic factors, it's not something that can be fixed at the systemic level without removing the feature altogether. The better solution is to detect the problem and react to it.

        See also: don't ban driving because of bad drivers, just get better at detecting and stopping bad drivers.

        I guess I'm just sick of so many developers, Valve included, using such manipulating tactics to get more money out of customers. They're using proven addictive design techniques to get people to spend money. It's just...gross.

        It would also be nice if Valve included some user agreement that banned these types of third-party sites (kind of what Mojang did with for-profit servers and business branding).

          It already is against the subscriber agreement in section G:
          You are entitled to use the Content and Services for your own personal use, but you are not entitled to: (i) sell, grant a security interest in or transfer reproductions of the Content and Services to other parties in any way, nor to rent, lease or license the Content and Services to others without the prior written consent of Valve, except to the extent expressly permitted elsewhere in this Agreement (including any Subscription Terms or Rules of Use); (ii) host or provide matchmaking services for the Content and Services or emulate or redirect the communication protocols used by Valve in any network feature of the Content and Services, through protocol emulation, tunneling, modifying or adding components to the Content and Services, use of a utility program or any other techniques now known or hereafter developed, for any purpose including, but not limited to network play over the Internet, network play utilizing commercial or non-commercial gaming networks or as part of content aggregation networks, websites or services, without the prior written consent of Valve; or (iii) exploit the Content and Services or any of its parts for any commercial purpose, except as expressly permitted elsewhere in this Agreement (including any Subscription Terms or Rules of Use).

          So unless they have written consent from Valve, they've probably breached the agreement by "exploiting the content for a commercial purpose", and possibly by providing a way to transfer items outside of Steam.

          I wouldn't be surprised to see Valve shut down the bot trading accounts used to run the site after these news stories, but it isn't obvious how easy it would be to detect new bot accounts violating the agreement.

            Ah okay, thanks for including that. I guess I'm looking for Valve to actively go after these kind of sites that prey on people. They would have to be pretty dumb to not even know of Lotto's existence (especially since the guys owning it have over 10 million subs), so why hasn't there been any action on their part before this?

            By allowing any "CS" gambling sites to have their branding and use their services, Valve are essentially condoning this behaviour.

        I dunno, I think Valve's actions are the root cause of all of this.

        They created a system within their games that allows all of this to flourish. They have created a marketplace that allows items to be sold and bought as commodities. Opening a crate is gambling. You pay $2.50 for a chance to obtain an item that's potentially worth more than $2.50, and Valve takes it that extra step allowing you to sell your items for real money.

        You put money in a slot machine for a chance to gain more money than it cost. You place a chip on a roulette table for a chance to gain more money than you spent. You open a crate for a chance to obtain more money than you spent. It's gambling 100%.

        Valve is using psychologically addictive and manipulative techniques to obtain money from their player base.

        Last edited 05/07/16 6:29 pm

          This is the best analogy of the situation that I have read.

          Gambling has never rooted well with me. I have never enjoyed or like the idea of potentially losing something, to potentially gain something. And that was basically how I felt about the steam crates when they first started in (and I stopped playing) TF2.

          Valve created a gambling platform and has disguised it so well as nothing more than dlc with rng. I'm actually also a little impressed, I suspect that they'd make excellent Bond villians.

          Thank you for this. You've explained it way better than I could. I won't support any developer that does this crap.

    If only there was a place I could bet some CSGO skins on what Martins announcement will be.

    The bigger problem here is that steam is allowing minors to gamble like this

      Steam doesn't allow it. Trading outside of the marketplace is against the Steam Subscriber Agreement.

        haha steam doesn't allow it.

          Section 2.G and 3.D of the Steam Subscriber Agreement, to be specific.

            how many people are banned from it actually? do you know anyone? people just put their age at over 18 and thats it they have access

            steam is as bad with the gambling of microtransactions as it is with the grey key market

            they dont enforce.... look at their forums... look at their customer service

            you talk to a bot

              Yes, gambling bots get trade bans every now and then. Check Reddit, I've seen threads from CSGOLounge and CSGOJackpot in the past complaining that they have tens or hundreds of thousands of dollars worth of items locked up in trade-banned bots.

              If I host a gambling website on a webhost that prohibits gambling, then I attract kids, it's not my webhost that's at fault and it's not their job to make sure my customers are old enough. I am the one who's solely responsible. If I pirate Game of Thrones over my internet connection, my ISP isn't responsible or culpable, I am. That principle was upheld in the iiNet case a few years back too.

              Likewise it isn't Steam's responsibility to enforce ages for gambling, it's against their terms of service to gamble in the first place. The people running the gambling services are the ones abusing the system and are solely responsible. Steam can certainly do more to enforce their SSA, but they're not culpable for the actions of people who abuse the service.

                making virtua items have real trade value should be strictly provable 18+ accounts that would be OK
                however any 12 year old can just say they are over 18 no proof required

                "tens or hundreds of thousands of dollars worth of items locked up in trade-banned bots"

                thats terrible

                really need a DMCA like takedown for abuse of virtua items

                what a future we live in

    As a long time player of CS I have never really understood the hype and noise behind gun skins.
    I'm currently Master Guardian Elite and have yet to open a box or even put a skin on any of my weapons. Though I have put some shiny wolf sticker on my AK-47 which means every few games I get a kid or two raging at me for "wasting a good sticker" on a stock weapon.

    Is it just a millennials thing lol? I'm more interested in the game play itself.

    h3h3, Ethan is the man.

      I'm exactly the same. Been playing almost 13 years and have absolutely zero interest in skins. Just something that I never got interested in, I guess.

      Back in the 1.6/Source days they were just a fun way to change up your game and didn't cost anything.

      The fact they expect us to pay now for less product is crazy. You used to get incredibly detailed gun models for FREE. The only issue was knowing how to install them.

        haha I remember those days, think I used a site called banana skins back in the day.
        Turned my M4 into aqua teen hunger force sound gun that played the intro music every time you shoot :P

        Last edited 06/07/16 11:01 am

          Was it fpsbanana? I remember that being my go-to site back in the day.

          Haha EVERY time you shoot? That would drive me crazy!

          I remember my game would play the intro to Voodoo Child by Hendrix when a round ended lol it may not be a skin but it's the little things like that which I miss from the pre-GO days.

            haha yes! that's the one Fpsbanana!

            Voodoo Child at the end of a game would have been awesome lol. Pre-GO CS days were amazing

    I'll never understand the Skin marketplace. Paying/gambling hundreds of dollars for a virtual skin on a virtual gun... Makes zero sense to me.

    Cassell and Martin refuted claims that they were not upfront about their ownership of the company. A number of Cassell’s videos have the line “this video is sponsored by CSGO Lotto”, and Cassell stressed as much on Twitter.

    This article doesn't appear to mention this, but that disclaimer was only added to those videos after HonorTheCall's video called them out on their deception. That is shown in the subsequent videos by HonorTheCall and H3H3.

    Last edited 05/07/16 5:26 pm

    I like how they claim they were upfront about owning the site... Yet there are videos of them very clearly saying it was something they basically just came across.

    I'm actually not sure what annoys me more... The fact people pull this shady bullshit, or the fact they do such piss poor jobs of hiding it while clearly assuming nobody would figure it out.

    "So today I found this site, which I own, completely out of the blue... You guys should use it. It seems pretty cool and they, meaning me since I own it, were cool enough to even offer me a sponsorship and such."

    Last edited 05/07/16 8:14 pm

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