FTC Charges Amazon With Allowing Kids to Spend Millions on In-app Purchases

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Amazon.com has billed parents for millions of dollars’ worth of unauthorized in-app purchases made by their children, the FTC said in a complaint filed Thursday in a U.S. court.

The FTC’s lawsuit, filed in U.S. District Court for the Western District of Washington, seeks a court order requiring Amazon.com to refund parents for unauthorized purchases made by their children. The FTC also wants the court to ban the company from billing parents and other account holders for in-app charges without their consent, the agency said in a press release.

Amazon.com keeps 30 percent of all in-app charges, the FTC said in its complaint. The Amazon case “highlights a central tenant” of consumer protection laws in the U.S., that companies should get customer permission before charging them, said Jessica Rich, director of the FTC’s Consumer Protection Bureau, during a press conference about the lawsuit.

Amazon employees raised concerns about in-app purchases by children years before the company changed its procedures, Rich said. Amazon customers seeking refunds found a process “unclear and rife with deterrents,” she said. Amazon’s official policy on in-app purchases said it does not give refunds, she added.

Amazon, in a letter to the FTC July 1, said it was “deeply disappointed” that the agency was moving toward filing a lawsuit. “We have continuously improved our experience since launch, but even at launch, when customers told us their kids had made purchases they didn’t want we refunded those purchases,” wrote Andrew DeVore, Amazon’s associate general counsel.

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SOURCE: Grant Gross 
PCWorld

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