Epic Games, the video game developer behind popular titles including Fortnite and Fall Guys, agreed to pay a $520 million USD settlement over charges that said the company illegally stored information from children and scammed players into making unwanted purchases, the Federal Trade Commission (FTC) announced on Monday.
The figure comprises two separate penalty amounts from two cases. First, Epic will pay $275 million USD for its violations of federal law, the Children’s Online Privacy Protection Act. Regulators accused the company of collecting personal data from children under the age of 13 who played Fortnite, without obtaining parental approval. Additionally, Epic forced parents to “jump through hoops” in order to delete their children’s personal information, and the company allegedly failed to do so on several occasions.
Epic’s $275 million USD settlement is easily the largest for child privacy violations, trumping Google’s $170 million USD penalty in 2019 over allegations that it collected personal information from children on YouTube.
Within Epic’s settlement, the company must make high-privacy settings the default for children and teen players. Specifically, Epic will need to disable settings that allowed live text and voice chats for players under 18.
In the second case, Epic agreed to pay $245 million USD in a refund to customers who accused the company of utilizing manipulative online schemes called “dark patterns” to scam players into making unwanted purchases. The agency said that Fortnite‘s interface had a “counterintuitive, inconsistent and confusing” setup, which tricked many users into spending money with a single click.
Players could mistakenly spend money while activating the game or when loading a new screen, and children oftentimes made unauthorized payments without their parents’ knowledge. The complaint said that Epic’s “dark pattern” techniques resulted in hundreds of millions of unintended purchases.
Stay tuned for more information.
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