Google to cough up $19 million in kids' in-app purchases case

Google to cough up $19 million in kids' in-app purchases case

Google is to pay out at least $19 million to Android users whose children were tricked into making expensive in-app purchases on smartphones and tablets. The Federal Trade Commission has been investigating mobile purchases for the last three years, and Apple agreed at the beginning of the year to a settlement. Amazon was also investigated and plans to appeal against the charges. In agreeing to repay the money, Google has effectively admitted that apps available in Google Play may be deceptive.

The brunt of the FTC case centers around the idea that it was not made clear to parents that their children would be able to make purchases within apps without authorization. Many of these in-app purchases are to be found in games where players are encouraged into parting with money in return for extra lives, game power-ups, or to unlock new levels. The FTC complained that since 2011 Google had indulged in unfair practices that left parents with bills of hundreds of dollars.

FTC Chairwoman Edith Ramirez said:

For millions of American families, smartphones and tablets have become a part of their daily lives. As more Americans embrace mobile technology, it’s vital to remind companies that time-tested consumer protections still apply, including that consumers should not be charged for purchases they did not authorize.

In 2012, Google did take steps to attempt to keep users informed of purchases. A popup was introduced that required a password to be entered before a purchase could be made, but the FTC found that the password was not required again for 30 minutes. During this time, it was possible to make unlimited in-app purchases, resulting in hefty bills. Google is required to contact all Android users who have made in-app purchases within 15 days of the FTC's order being finalized. Refunds must be made promptly, and if after one year Google has paid out less than $19 million, the remainder must be paid to the FTC.

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