Feds seek info on allegations AviaGames uses bots to scam humans in skill games
Skillz told a federal court on Monday that a federal grand jury was seeking access to information on AviaGames and its top executives in relation to Skillz’ allegations about defrauding players in skill-based games.
Skillz has alleged that AviaGames use of bots in its games — which are supposed to be matches between humans where real money prizes are at stake — constitute illegal gambling and fraud against consumers. The allegation has arisen in the course of a copyright and patent lawsuit between Skillz and AviaGames, which operates a rival to Skillz in skill-based games with real money prizes.
The new allegations of a federal investigation came to light this week in the course of 2.5 years of litigation between AviaGames and Skillz, which was a larger publicly traded company that discovered it was losing customers to the fledgling AviaGames startup. If what Skillz alleges is true, then a massive fraud is taking place, the company said in its filings. Players are betting cash on games in which they’ve been told they’re playing other people but where they’re actually playing bots.
Skillz was the early market leader, founded in 2012, while Mountain View, California-based AviaGames started in 2017. And Las Vegas-based Skillz Platform went public in December 2020 through a quick initial public offering process known as a special purpose acquisition company (SPAC). The company and early investors raised $848 million at a valuation of $3.5 billion. Net proceeds for Skillz itself were $240 million. But lately the company has been trading at a value of $123 million.
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