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Mystery Brand responds to scam, gambling accusations after YouTube controversy

Mystery Brand responds to scam, gambling accusations after YouTube controversy


‘We do not need to physically own these cars or houses to include them as prizes’

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Mystery Brand
Brian “RiceGum” Le talking about the Mystery Brand controversy.

Mystery Brand, the controversial loot box-style website promoted by YouTube creators like Jake Paul and Brian “RiceGum” Le, has confirmed it doesn’t own some of the prizes offered to users, and collects others through a public online marketplace.

The quality of prizes offered to users through Mystery Brand varies from cheap fidget spinners to California mansions and luxury cars. Mystery Brand teamed up with Paul and Le for sponsored videos, reportedly paying at least $100,000 for both creators through sponsorship deals. The videos showed Le and Paul winning an assortment of prizes, including a pair of Off-White Nike Air Max 97 shoes (valued at $835) and an iPhone XS (valued at $1,000). A number of Mystery Brand users on Reddit and Twitter have raised questions about the company, accusing it of giving away fake items or not delivering prizes at all. Both Le and Paul faced harsh criticism from the YouTube community for promoting the site, including videos from major creators like Ethan Klein and PewDiePie.

“We do not need to physically own these cars or houses to include them as prizes in the box”

Now, Tim Perk, a representative for the company, is addressing a number of complaints. Perk told The Verge via email that the company doesn’t own some of the prizes offered on the site, including a mansion listed for $250 million or expensive luxury cars. The house in question is a Beverly Hills residence listed on Zillow for $188 million. Top-of-the-line Lamborghini and Ferrari models also appear on Mystery Brand’s website.

Perk told The Verge that although specific mansions and models may appear on the site, the company doesn’t actually have the rights to give them away.

“We do not need to physically own these cars or houses to include them as prizes in the box,” Perk said. “If the user were to win such a prize, we would either offer them the exact money value of the prize, or our representatives would personally fly in to the city of the winner and help them with the purchase of a car or house.”

Prizes like a $188 million mansion are extremely rare, according to Perk, who added that Mystery Brand’s team can “afford to personally attend to the winner” in the event that someone were to win. None of this is listed anywhere on Mystery Brand’s website, including within the terms of service or FAQ page. There isn’t any hint that Mystery Brand doesn’t own the items it’s selling.

Claims that Mystery Brand delivered “fake winnings” or failed to deliver goods at all are “completely untrue and unjustified,” Perk told The Verge. Perk also noted that Mystery Brand relies on StockX, a popular reselling platform often used by sneakerheads.

“Sometimes, shipping may take up to a couple of weeks since we mostly use the StockX platform for purchasing and delivering prizes to the winners,” Perk wrote. “StockX has a longer delivery time because each item is thoroughly checked for authenticity, and we would happily sacrifice delivery time to ensure our customers only receive authentic products of the highest quality.”

Reached by The Verge, a StockX representative said they were completely unaware of Mystery Brand, and no formal partnership exists between the two companies. As a result, any products purchased by Mystery Brand were likely obtained through a common user account.

StockX, which bills itself as “the Stock Market of Things,” allows users to place buy orders for deadstock items at a specific price. That new approach to the billion-dollar streetwear market has attracted a number of high-profile investors. A $55 million Series B round this summer included investment from Google Ventures, SalesForce, and Steve Aoki, among others.

“I received a fake Supreme x North Face Baltoro mountain jacket,” one StockX user said

Despite its broad scale and ample funding, StockX has struggled to keep counterfeit products out the marketplace. A number of users have reported receiving knockoffs through the platform, often recounting the experience in YouTube testimonials.

“I received a fake Supreme x North Face Baltoro mountain jacket from Stockx earlier this year,” another person on Reddit said. “It’s actually so frustrating to see a multi-million dollar company do well despite numerous incidents of fake items slipping through the authentication process. Their lack of customer support is also a joke.”

StockX says it verifies the authenticity and condition of each product before it is sent to buyers, but scammers have often found creative ways around those restrictions. StockX told The Verge that it maintains a 99.85% authenticity rate, and that any substandard goods can be returned through a customer support line. But since Mystery Brand buyers would have had no idea their orders had been fulfilled through StockX, it would have been difficult for them to take advantage of that service.

Reached for comment, StockX CEO Josh Luber said the company had made significant investments to keep counterfeits off the platform. “StockX prides itself in providing its users an anonymous, transparent, and authentic marketplace. We have four authentication centers globally with highly-trained, highly-skilled authenticators on staff,” Luber said. “We respond to every message and and will always do whatever it takes to resolve an issue — just email”

Mystery Brand’s reliance on StockX could also explain why many buyers had to wait so long for their goods. Some Mystery Brand buyers reported not receiving goods for more than a month after their purchase, stoking concerns about the company. But unlike a conventional store, StockX doesn’t guarantee that a given product will be available at a given time. It’s entirely possible that the relevant products simply weren’t available on StockX at the time they were won.

Mystery Brand’s own terms of service also specifically state that while people are “using the services of the website You may encounter circumstances in which Your won items will not be received.” The terms also say, however, that the company will try to rectify the situation.

“Our site provides everyone with equal odds of winning certain prizes”

“In this case, the Web site will make every effort to resolve this situation and try as soon as possible to resolve Your problem. The maximum term of consideration of the defect/error is 45 working days.”

After multiple testimonials on Reddit and broader backlash from the YouTube community, Perk told The Verge he wanted to address concerns Mystery Brand was a scam.

“Our site provides everyone with equal odds of winning certain prizes,” Perk said. “We also incorporated an independent service ‘Provably Fair’ into our website, a service often used by online casinos to ensure that everything is fair and transparent and provides guarantees that the winnings were random and not predetermined in any way.” A report from The Daily Beast discovered that the odds for winning luxury items — like the $188 million house — have since been removed.

Perk’s statement also raises new questions about whether Mystery Brand counts as gambling. “Provably fair” services are heavily associated with online casinos, primarily used to show that a given game isn’t overly skewed in the house’s favor. YouTube’s community guidelines for advertisements, videos, or creator sponsorships specifically state that links to “online gambling casinos” are prohibited as the company considers it harmful content for viewers. It’s still debatable whether Mystery Brand meets that description, but the presence of an audited odds-making service could have a significant impact. The Verge has reached out to YouTube for further comment.

Since the controversy began earlier this week, both Le and Paul have issued statements on the situation. Le published a video addressing the controversy, telling viewers they should do additional research for themselves before using Mystery Brand, and apologizing for potentially misleading them. Paul tweeted about the situation, telling kids not to gamble.

Perk called out one creator involved in the situation, Daniel “Keemstar” Keem, in his email to The Verge, noting that Mystery Brand never approached Keem for a sponsorship deal despite Keem’s claims on Twitter.

“He notified his thousands of followers through twitter that we offered him $100,000, which is a blatant lie,” Perk said. Keem acknowledged his mistake on Twitter after a journalist for Storyful asked him for more details on his reported offer from Mystery Brand.

“Was not contacted by that exact website,” Keem tweeted. “But a similar one via email. Apparently there are many like Mystery.”

The Verge has reached out to Perk for additional comment, and will update when more information becomes available.

Update 4:12PM ET: Updated to include comment from Stock X.