The Washington State Gambling Commission, a state agency governing gambling in that fair corner of Cascadia, has told Valve that they must “stop facilitating gambling” with Steam skins. If you’ve missed this whole fuss, basically: sites have been using Counter-Strike and Dota cosmetic item skins as chips for unregulated – and potentially underage – gambling, all running through Steam channels. Steam’s rules do forbid this and Valve recently stepped up and started sending legal letters ordering sites to knock it off. Now The Man is involved in Valve’s home state, and he’s none too pleased.

The problem is that while skin gambling sites aren’t run by Valve and the Steam user agreement forbids it, these sites do connect to Steam through a Steam API and use Steam accounts run by bots to cash in and cash out items. That’s enough to upset the Gambling Commission. Yesterday they announced their interest, saying they first contacted Valve about this problem in February. Their stance now is this:

“Based on the information it has gathered, the Gambling Commission directed Valve Corporation to stop facilitating the use of ‘skins’ for gambling activities through its Steam Platform. The Gambling Commission expects Valve to take whatever actions are necessary to stop third party websites from using ‘skins’ for gambling through its Steam Platform system, including preventing these sites from using their accounts and ‘bots’ to facilitate gambling transactions.”

The Commission has given Valve until October 14th to explain how they’re compliant with Washington State’s gambling laws, under threat of “additional civil or criminal action”. Lawks.

Valve’s Doug Lombardi, asked about this by the folks at cheery RPS fanzine PC Gamer, pointed again to their their July announcement that skin gambling was naughty and forbidden. “Our position has not changed and so far we’ve sent cease and desist notices to over 40 sites,” he said.

We’ll have to see if that’s enough to satisfy The Man.

The skin gambling fuss has done a fine job proving the importance of regulation. It’s turned up cases of YouTubers being paid – and not disclosing it – to promote skin gambling sites with fixed big wins, and people even promoting sites they themselves secretly own. While some sites are fairly well-trusted, there’s no guarantee that any of it is legit. It’s not just Steam caught up in this mess, mind – two men in the UK have been charged over a site gambling with virtuacoins from FIFA’s Ultimate Team mode.