BoardAndFraud

Ethics – eSports Cheating

Overview

Chinese police have arrested ten people, calling themselves Chicken Drumstick, connected to an eSports or video game cheating ring that made an outrageous $100 million in profit.

eSports can be defined as a multiplayer video game played competitively for spectators, typically by professional gamers, but has grown in popularity in colleges and universities. More than 50 colleges have varsity eSports programs governed by the National Association of Collegiate Esports or NACE, a 501 c3 non-profit membership association. These championships pay thousands of dollars in prize money, which is put towards scholarships for the winners.

According to CNN, “eSports describes the world of competitive, organized video gaming. Competitors from different leagues or teams face off in the same games popular with at-home gamers: Fortnite, League of Legends, Counter-Strike, Call of Duty, Overwatch, and Madden NFL, to name a few. These gamers are watched and followed by millions of fans worldwide, who attend live events or tune in on TV or online. Streaming services like Twitch allow viewers to watch as their favorite gamers play in real-time, and this is typically where popular gamers build up their fandoms. Tournaments and other events can attract viewing crowds that rival most traditional professional sports outings. The 2017 League of Legends World Championship drew more than 80 million viewers.

By 2023, Newzoo predicts that the annual growth rate will be approximately 10.4% and expect the number of casual viewers will grow to about 350 million. Also, there will be around 300 million eSports enthusiasts, making the total audience 650 million.

eSports, at its highest levels, functions in a similar way to the NBA and NFL.

Chicken Drumstick

According to the BBC article, the bad actors, who called themselves “Chicken Drumstick,” developed and sold various cheats or hacks to some of the most popular video games, including big titles like Overwatch and Call of Duty Mobile. Hacks may enable a player to see others through walls or automatically shooting anybody who comes across their path.

Chicken Drumstick surfaced in several countries and sold subscriptions ranging from $10 a day to $200 a month, so they made some serious money. By the time police closed in, Chicken Drumstick had managed to rake in more than $75 million in revenue. According to the BBC, police also seized approximately $45million in assets that included several luxury cars.  The police operation was aided by Chinese gaming giant Tencent and led to the arrest of 10 people in connection with the ring.

Cheating in video games is an increasing problem many developers are facing. It also begs the question: Does this behavior carry over into the classroom and work?

Ethics

Many years ago, I gave an ethics presentation, and below is an excerpt from the deck.

Ethics doesn’t appear to get better with age.

Let’s look at some more alarming data.

Florida State University released a study a while back of more than 700 people within a variety of industries and at different employment levels revealed some interesting facts:

All of these behaviors demonstrate that these bosses lacked personal values and personal ethics. This lack of ethical behavior may be attributed to top management because upper management has probably modeled the same behaviors. Finally, there are probably no core values adopted by the organization within the strategic plan. Even if there is a values statement, it is much more for show.

So what are some of the core values of an ethical individual and high-integrity organization? 

Individual 

Organization

Here are some situations that encourage bad behavior

The New Ethics Paradigm

Some Red Flags

Closing

It would appear that children who cheat will be cheaters, and those hosting eSports activities (i.e., colleges and universities) need to have compliance and ethics programs in place.

I welcome your thoughts and comments.

Best,

Jonathan T. Marks, CPA, CFF, CFE

 

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