Apple to refund more than $32.5 million for kids’ in-app purchases

David Parker January 16, 2014 0

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In the fiasco where Apple inadvertently allowed kids to make in-app transactions from its app store without the need to take their parents’ consent, Apple has reached a settlement with the Federal Trade Commission and will refund more than $32.5 million to the customers whose kids made such unauthorised transactions.

Apple recently, on Wednesday, had an agreement with the Federal Trade Commission and the amount was decided there. Edith Ramirez, the Commissioner, FTC, said after the agreement that it was a mistake from Apple’s side. The company failed to inform parents that if they enter their Apple store passwords when they order something, the window is kept open for 15 minutes and during this 15-minute period, children can make unlimited in-app transactions in games which does not require their parents’ consent. Of course, parents got the shock of their lifetime when they saw thousands of dollars racked up in their credit card statement.

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Something like this happened with most of the parents when they realised later on that it was all due to the failure of the company to notify the parents about this issue. As soon as the issue was resolved, a meeting between FTC and Apple was arranged and it was decided in the agreement that the company would refund the entire amount to the parents.

Ramirez said in a statement,

This settlement is a victory for consumers harmed by Apple’s unfair billing, and a signal to the business community: whether you’re doing business in the mobile arena or the mall down the street, fundamental consumer protections apply. You cannot charge consumers for purchases they did not authorize.

According to the reports, children made heavy transactions in games such as “Tiny Zoo Friends” and “Dragon story”. A little girl spent almost $2600 in Tap Pet Hotel. Other reports about almost $500 purchases made by the kids also cropped up, leaving parents of such kids in trouble.

Since there was no fault of the parents, Apple did not argue over the matter and quickly agreed to make the refund. Although Apple has sent apology emails to all the customers who were affected due to this issue, various other customers of Apple, who could have been affected also deserve an apology letter, the commissioner remarked.

Apple said that their top policy is the safety of the children. Also, the company notified parents about the 15-minute window later on and provided them an option to cancel it.

Apple spokesman Steve Dowling said,

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.

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