Apple to pay at least $32.5 million over no-consent app purchases

The FTC complaint said Apple did not do enough to stop children from making purchases without parental consent

Did your child want just one more life on Angry Birds, so they just went ahead and bought it? You as a parent may have been angry, but you may have unexpected ally in the Federal Trade Commission (FTC).

On Jan. 16, Apple settled an FTC complaint that the company did not do enough to stop children from making purchases on mobile apps without parental consent. By the terms of the agreement, Apple will pay back the unauthorized charges, a minimum of $32.5 million, and adjust its billing practices to make purchases without consent impossible.

FTC Chairwoman Edith Ramirez said that children were racking up “millions” in unknown charges to their parents’ bills. According to Ramirez, Apple should have made it clearer to parents that by entering a password on their mobile device, they had inadvertently opened a 15-minute window by which children could make purchases without consent.

Ramirez claims that the FTC brought action against Apple because a class action suit concerning the same subject did not go far enough. She said the class action only resulted in damages, while the FTC action required Apple to change their disclosure rules. She also said that Apple has further to go to become compliant.

“The problem identified in our complaint continues to this day. They have until March to rectify it,” Ramirez said to The Wall Street Journal. “So in our view, the problem has not been fixed to date.”

In a written statement, Apple said that it plans to comply fully and quickly. “Protecting children has been a top priority for the App Store from the very beginning, and Apple is proud to have set the gold standard for online stores by making the App Store a safe place for customers of all ages,” the statement said. “Today's agreement with the FTC extends our existing refund program for in-app purchases which may have been made without a parent's permission.”

 

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Zach Warren

Zach Warren is Assistant Editor of InsideCounsel magazine, where he oversees online content submissions and administers InsideCounsel's enewsletters. Zach specializes in new media and multimedia...

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