Epic Games has agreed to pay the whopping $520 million fine issued by the FTC over “tricking millions of users into unintentional purchases”. According to the FTC, Epic Games violated the Children’s Online Privacy and Protection Act by collecting children’s data without parental consent. The COPPA requires every child to have parental consent before a company can collect any personal information on them. The FTC proved that Epic Games did this without consent while at the same time, making it difficult for parents to have their children’s data deleted.
“Epic put children and teens at risk through its lax privacy practices, and cost consumers millions in illegal charges through its use of dark patterns,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “Under the proposed orders announced today, the company will be required to change its default settings, return millions to consumers, and pay a record-breaking penalty for its privacy abuses.”
The fine is split into two portions. The company is being forced to pay a $275 million fine for breaking the COPPA protection act. In addition, the FTC slapped Epic Games with another $245 for its “dark patterns and billing practices”.
The FTC says that Epic Games’ in-game store for Fortnite is misleading and the constant change to the menu and system has led users to unintentional purchases. Prior to 2018, users were also able to purchase V-Bucks on Fortnite with one press of a button. The system didn’t require any authorization for credit card purchases and no passwords either.
The FTC has also found Epic Games guilty of blocking user accounts for those who disputed purchased content. This locks them out of all owned content. Some users amassed thousands of dollars worth of digital content only to be locked out of it when they disputed illicit purchases.
- Blocked access to purchased content: The FTC alleged that Epic locked the accounts of customers who disputed unauthorized charges with their credit card companies. Consumers whose accounts have been locked lose access to all the content they have purchased, which can total thousands of dollars. Even when Epic agreed to unlock an account, consumers were warned that they could be banned for life if they disputed any future charges.
Epic ignored more than one million user complaints and repeated employee concerns that “huge” numbers of users were being wrongfully charged. In fact, Epic’s changes only made the problem worse, the FTC alleged. Using internal testing, Epic purposefully obscured cancel and refund features to make them more difficult to find.
This historical lawsuit will now force Epic Games to tighten its belt on children and its purchase system. Epic Games has already implemented a new account system into its platform to prevent children from creating accounts without parental consent.
You can read the entire lawsuit here.