Parents warn against video game use after son spends $4,000 on their credit card

The Consumer Financial Protection Bureau estimates that $57bn is spent on video games every year

Parents are expressing concern over the pricey consequences of video games on children.

Michael and Jennifer Ferri couldn’t believe their eyes when they found $4,000 in video game charges on their credit card from their eight-year-old son, Joey. “I mean, I lost my mind,” Jennifer recently admitted to Good Morning America.

But however mad she and her husband were, she revealed that Joey hadn’t intentionally spent their money, as he thought his purchases only existed in the virtual world of his game.

“I think sometimes, it’s confusing as to what’s real money and what’s fake money,” Michael noted.

Gaming assets, the medium of exchange used in transactions in video games and virtual worlds, are often assumed by young players to not have actual value in reality, which isn’t true. These assets are used to buy “goods and services and person-to-person [“P2P”] transfers,” according to the Consumer Financial Protection Bureau (CFPB).

The CFPB explains how “gaming assets flow in and out of gaming marketplaces in a variety of ways and can have immense value”.

“To leverage that value, financial products and services have begun entering gaming in the form of payment processing, money transmission, and even loans,” they continue.

In July 2023, the Entertainment Software Association reported that three out of every four children under the age of 18 regularly play video games.

What’s more, the CFPB found: “Billions of US dollars are spent each year in gaming and virtual worlds, where consumers buy gaming assets using fiat currency and then use those assets to make purchases in-game.”

Specifically, the CFPB estimates that $57bn is spent on video games each year.

Amid a surge in virtual spending, the CFPB is warning users about fraud and scam risks. CFPB director Rohit Chopra spoke to ABC News about how using virtual currency to purchase in-game additives isn’t always secure.

“What’s pretty obvious is that [video game companies’] financial incentives are for players to spend as much as possible,” Mr Chopra acknowledged. Gaming accounts don’t always have the protections and security measures that are placed on real-life banking accounts.

“When we have a fraudulent charge on our credit card, we can fight it,” he said. “Many times you see on these gaming platforms, there’s really just finger pointing or not really taking accountability.

“We shouldn’t think of this as traditional video games. It’s an immersive world [with] its own economy. But what we want to make sure [of] is that it’s not just a way to sidestep existing rules.”