Yesterday, the FTC announced that Apple will provide full consumer refunds of at least $32.5 million dollars to settle an FTC complaint that it charged for kids' in-app purchases without parental consent. This settlement demonstrates that the FTC is continuing to protect our children and families against potential unfair and misleading trade practices in the digital space.
The FTC complaint alleged Apple violated the FTC Act by failing to tell parents that by entering a single password they were consenting to an in-app purchase. In particular, it was alleged that parents (account holders) were not informed that
entering their password would open a 15-minute window in which children
can incur unlimited charges. Under the Consent Order, Apple is required to change its billing practices to ensure
that it has obtained "express, informed consent from consumers" before
billing for items sold in mobile apps.
The FTC's mobile apps for kids reports put mobile app developers and ecosystem owners on notice that the FTC is watching the entire space to protect children and families from unfair and deceptive trade practices. This new enforcement action combined with the FTC's previous activities reinforces the notion that the mobile environment contains serious personal privacy and safety issues along with potential unfair trade practice issues that need to be addressed.
Copyright 2014 by the Law Office of Bradley S. Shear, LLC All rights reserved.
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