WATA "Supporter" Sells Atari Games

A copy of the original Sonic the Hedgehog game for Sega Genesis has been sold for a record-breaking sale price of $430,500 USD. This isn't just a new record for this Sonic game, either; it also makes it an "all-time" record sale for any Genesis title. This graded game has been 'WATA Certified'. As you might recall, WATA is one of the grading companies that has been previously under fire for allegedly manipulating the retro video game market. Just recently, for example, the co-founder was accused of selling the company's games under a different alias on eBay.

Sonic the Hedgehog's co-creator, Yuji Naka, even saw the latest sale himself, talking about the possibility of it being a "scam": "That's a scam right? I wondered if it was time for Sonic to reach a high." Of course, many responses on social media were quick to link Karl Jobst's YouTube video and follow-up stories about the graded games market in recent times. It's not just Sonic we're seeing this with. Back in August, a copy of the original Super Mario Bros. on the NES sold for a record-breaking $2 million.

WATA previously shared the following statement in response to Karl Jobst's accusations about "fraud and deception" in the retro games market: "Wata Games is the trusted leader in collectible video game grading and we're honored to play a key role in this booming industry that we are incredibly passionate about. We're humbled by the support of our thousands of customers who trust us to provide accurate and transparent grading. The claims in this video are completely baseless and defamatory and it is unfortunate that Mr. Jobst did not contact us to give us the opportunity to correct him."

A co-founder of retro game grading service WATA is now being accused of running a side business on eBay. Further investigations by Proof journalist, Seth Abramson, suggest WATA's Mark Haspel is selling graded games under an alias. Abramson was recently reviewing some of his previous purchases and found a note from a seller informing him how he could contact Haspel for more games. He's also matched up addresses on parcels linked back to Haspel. At the time of the Proof report, Haspel's account was selling 74 WATA-graded Atari 2600 games valued at around $46,000 USD.

Proof believes Haspel is selling Atari games exclusively on eBay in an attempt to go unnoticed by American journalists who have so far only focused on record-breaking Nintendo game sales. And out of all the Atari games listed, only one of them had a grade lower than 9.0 and no seal rating lower than A+. According to WATA's standards, these qualify as an "investment grade" purchases. The same source alleges Haspel could be studying the market with the assistance of WATA's "population" data in an attempt to increase the value of Atari titles. And unlike any other collectibles market, this data is not made public. "There is a chance that Haspel is selling only Atari games because he knows that this market is waning due to few people sending in these games to be graded. If Haspel is using any such data to determine which games to buy, get graded, and sell, there's at least the danger that he's participating in what investigators might consider insider trading."

"In almost every collectibles market in the US, grading companies make population reports public so that no one in the market has special access to corporate data they could use to make investments relating to their own company." Former WATA board member Jeff Meyer resigned from his position in January last year after being accused of selling a large collection of WATA-graded games in 2019 for large amounts of cash.

The first thing I did after realizing what Haspel was doing - as well as the extraordinary amount of money he's making annually doing it - was check WATA's Securities and Exchange Commission (SEC) filings to confirm that, indeed, its most recent Form D filing lists Haspel as a "promoter" of WATA (defined by the SEC as "Any person who, acting alone or in conjunction with one or more other persons, directly or indirectly takes initiative in founding and organizing the business or enterprise of an issuer" or "Any person who, in connection with the founding and organizing of the business or enterprise of an issuer, directly or indirectly receives in consideration of services or property, or both services and property, ten percent or more of any class of securities of the issuer or ten percent or more of the proceeds from the sale of any class of such securities"). Given that WATA has not issued any new Form D SEC filings since the one that lists Haspel as a founder and organizer of WATA in July 2018, there seems to be no way Haspel selling graded WATA games doesn't run afoul of the corporate policy WATA president and CEO Deniz Kahn insisted was active and stringent in speaking with the New York Times in 2020.

Second, I checked, at the time more out of curiosity than journalistic necessity, to see how Haspel had fared in getting his games graded by a company that WATA has told the SEC he's still a part of.  Out of the 74 games WATA co-founder Mark Haspel is now selling on eBay (products with a total declared value of nearly $50,000), only one (1.4% of the total) received lower than a "9.0" box-condition assessment, and none received a seal rating below "A+." This would be astounding even if Haspel's games weren't all second-generation games from the 1980s - games so old that experts like Mark Wade from Certified Collectibles say they must be considered "investment-grade" (the best condition one could hope to find a video game in, and a prerequisite for serious investors) if they are graded at a "9.0" or above.