The U.S. Federal Trade Commission on Monday announced a $520 million settlement with Epic Games, the maker of popular video games such as Fortnite and Fall Guys, alleging the company illegally collected information on children and each tricked millions of players into making unintentional purchases .
The deal involved record fines in two separate cases.
Epic agrees to pay $275 million to settle regulator charges that it violated the federal law, the Children’s Online Privacy Protection Act, by collecting personal information from children under the age of 13 playing the Fortnite game without verifiable parental consent . The company also makes parents “jump through hoops and hoops” to delete their children’s data, sometimes failing to honor parents’ deletion requests, the agency said in a legal complaint filed Monday.
The amount dwarfs the $170 million fine Google agreed to pay in 2019, a previous record for violating children’s privacy, after it was accused of illegally harvesting children’s data from YouTube and using it to target ads to them.
As part of the proposed settlement, the agency will require Epic to adopt high-privacy default settings for children and teens. That meant the company had to turn off a setting that enabled real-time text and voice chat for younger users.
Epic also agreed to pay $245 million to refund consumers over allegations that it used online manipulation known as “dark patterns” to trick users of all ages into making unintended purchases. In a separate complaint, the regulator said that, among other things, Fortnite’s user interface had a “counterintuitive, inconsistent and confusing” layout that caused users to incur fees simply by pressing a button.
Players may be charged when attempting to activate the game from sleep mode or when the game loads, the complaint said. The kids ended up making unauthorized charges without their parents’ knowledge. These dark mode techniques cost users hundreds of millions of dollars in unnecessary costs.
This is a developing story. Check for updates.