SEC Investigation Targets Roblox, Report Reveals

Roblox, the immensely popular live service game, is currently under investigation by the U.S. Securities and Exchange Commission (SEC), as per a recent report. The specifics of the investigation remain shrouded in mystery. In response to a Freedom of Information Act request, the SEC acknowledged to Bloomberg that Roblox has been mentioned in communications related to an "active and ongoing investigation." However, the commission refrained from disclosing further details, citing potential harm to the ongoing enforcement proceedings. Bloomberg was unable to ascertain the focus of the investigation, and Roblox did not respond to requests for comment from the outlet. The SEC also declined to provide additional information.

Roblox has faced scrutiny from various quarters in the past. Last October, a report accused Roblox Corporation of inflating its daily active user (DAU) statistics and creating a "hellscape" for children. Roblox vehemently denied these allegations on its website, emphasizing that "safety and civility" are core to its platform. The company also admitted that undetected fraud and unauthorized access could lead to an overstatement of DAUs. In 2024, Roblox announced significant updates to its safety systems and parental controls.

Previously, families filed lawsuits against Roblox in 2023, claiming the corporation misrepresented its ability to ensure the site's safety and appropriateness for children. A 2021 report by People Make Games delved into Roblox's user-generated content, questioning whether it was exploiting creators.

Last week, Roblox shares experienced an 11% decline after the company reported 85.3 million daily active users, falling short of the StreetAccount estimate of 88.2 million. Roblox CEO David Baszucki stated that the company would continue to invest in its virtual economy, app performance, and "AI-powered discovery and safety," with the aim of empowering creators and enhancing the user experience.