The Blubber

In response to a Freedom of Information Act (FOIA) request, the Securities and Exchange Commission (SEC) said in a letter on Friday that it couldn’t release internal correspondence mentioning Roblox, citing potential harm to an “ongoing enforcement proceeding.”

“We have confirmed with Division of Enforcement staff that there are responsive emails between Enforcement staff referencing Roblox and that these emails are part of an active and ongoing investigation,” the SEC wrote in its response.

Bloomberg News couldn’t determine the specific focus of the investigation. Roblox did not respond to requests for comment, and the SEC declined to provide additional information.

In November, Hunterbrook Media reported that Roblox was under investigation by the SEC, based on documents obtained through FOIA requests. The publication cited an October letter from the SEC, which stated that the commission was withholding records because releasing them “could reasonably be expected to interfere with enforcement activities.” Hunterbrook Media’s affiliate, Hunterbrook Capital, held a short position in Roblox shares at the time.

In October, short-seller Hindenburg Research—now defunct—published a report raising concerns about child safety on Roblox and accused the company of inflating key metrics, including its active user count and average time spent on the platform.

“We completely reject the claims made in the report,” a Roblox spokesperson said in response. “The authors are self-admitted short sellers with an agenda that has nothing to do with the substance of Roblox’s business model or performance.”

Hindenburg Research announced it was shutting down operations in January.

Shares of Roblox fell as much as 4.8% following Bloomberg’s report. By 2:33 p.m. in New York, the stock was down 2.4%, trading at $65.53.

Roblox has come under scrutiny over child safety on its platform. Since 2018, at least two dozen people in the U.S. have been arrested for abusing or abducting victims they met through Roblox, according to a Bloomberg News investigation in July.

In response, Roblox made at least 40 safety changes to its platform in 2024, including banning users under 13 from participating in social chatting games. The San Mateo, California-based company has emphasized that user safety remains its top priority.