Kickstarter investment gone sour? Tell the Feds, they’re cracking down
The saga of “The Doom That Came to Atlantic City!” is not so different from many of the tales of Kickstarter gone wrong.
Enthusiastic backers rushed to invest in the board game, a collaboration between well-known artists and game designers in which characters dreamed up by cult horror writer H.P. Lovecraft set out to destroy Atlantic City. The campaign raised $122,874 from 1,200 people, far exceeding its initial $35,000 goal. Years later, the game had still never materialized, leaving its funders to ponder fruitlessly in the campaign comments section what had become of its creator.
With few options for recourse, the jilted crowdfunder has been regarded as a hit-and-run victim of our bold new economic era. But the Federal Trade Commission issued a signal Thursday that it’s cracking down, announcing a settlement in its first ever legal action against a crowdfunding campaign gone awry. And it may not be the last: An FTC spokesperson told Fusion that the number of crowdfunding complaints the agency receives is on the rise.
“Our goal is to deter fraudulent actors from misusing these platforms,” Helen Wong, an FTC attorney who worked on the case, told Fusion. “We want to ensure a level playing field for people with good intentions who are using these sites.”
Thursday’s announcement is part of an ongoing effort, the agency said, to ramp up investigation efforts into “new and emerging financial technology.”
“The Doom That Came to Atlantic City!” hit Kickstarter back in 2012, a project helmed by a company called The Forking Path run by a man named Erik Chevalier.
“After paying to form the company, for the miniature statues, moving back to Portland, getting software licenses and hiring artists to do things like rule book design and art conforming the money was approaching a point of no return,” Chevalier wrote in a June 2013 Kickstarter post announcing the game would be cancelled. “My hope now is to eventually refund everyone fully.”
But few, if any, backers every received a refund, the FTC alleged in a complaint against Chevalier released Thursday along with news of a settlement. The complaint argues that Chevalier deceived backers, spending most of the money he raised on personal costs like moving rather than actually making the game.
At the time the game was cancelled, one of the artists associated with the project, Keith Baker wrote on his blog that he had never received money for the project, or even heard anything about its demise until its fate had already been decided.