The Federal Trade Commission announced on Tuesday that Amazon will soon start refunding millions of dollars worth of in-app purchases that were made by children but not authorized by their parents.
Nearly one year ago, a federal district court ruled that Amazon was liable for allowing children to make purchases while playing games on apps—without giving parents sufficient warnings or safeguards against the surprise purchases. This week, Amazon dropped its appeal of the ruling. The FTC says that more than $70 million of purchases made between November 2011 and May 2016 are eligible for refunds from Amazon, and that details of the refund program "will be announced shortly."
The FTC first filed a case against Amazon in 2014, seeking refunds for unauthorized purchases and a permanent ban on "billing parents and other account holders for in-app charges without their consent." The complaint pointed out that apps like "Ice Age Village" enticed players—who were often children—to purchase "coins" and "acorns" to advance further in the game. Players were allowed to purchase up to $99.99 at a time. The FTC stated in 2014:
The FTC previously brought similar complaints against Google and Apple. In 2014, for example, Apple agreed to a $32.5 million settlement stemming from children making unauthorized in-app purchases.
Soon, parents whose kids made surprise purchases in apps downloaded from Amazon will get some money refunded as well.
“This case demonstrates what should be a bedrock principle for all companies — you must get customers’ consent before you charge them,” Thomas B. Pahl, acting director of the FTC’s Bureau of Consumer Protection, said in the FTC press release on Tuesday. “Consumers affected by Amazon’s practices can now be compensated for charges they didn’t expect or authorize.”