Skip to main content

Apple Will Refund at Least $32.5 Million in FTC Settlement




Apple has agreed to pay at least $32.5 million to settle a Federal Trade Commission (FTC) complaint that it charged consumers for in-app purchases incurred by children on kids’ mobile apps without verifiable parental consent.  Apple has also agreed to change its billing practices by March 31, 2014 to ensure that it receives “informed” verifiable parental consent before charging for in-app purchases made on mobile apps directed to children. Apple also agreed that if it gets consumers’ consent for future charges, consumers must have the option to withdraw their consent at any time.

Under the current system on iTunes, parents were required to enter a password to process in-app purchases, however, according to the FTC, Apple failed to notify parents that by doing so, in addition to approving a single in-app purchase that they were also consenting to 15 minutes of additional unlimited purchases their children could make without further action from the parent.

In its press release, the FTC noted that Apple has received thousands of complaints about unauthorized purchases. FTC Chairwoman Edith Ramirez said in a statement, “This settlement is a victory for consumers harmed by Apple’s unfair billing, and a signal to the business community: whether you’re doing business in the mobile arena or the mall down the street, fundamental consumer protections apply, you cannot charge consumers for purchases they did not authorize.” 

Under the settlement, Apple must pay at least $32.5 Million to consumers billed for in-app purchases incurred by children that were accidental or unauthorized. Should Apple be required to issue less than the full $32.5 million, it must forfeit the balance to the FTC.

For more information visit the FTC's Press Release.

Popular posts from this blog

Advocates believe Kid Influencers Deserve Same Protections as Other Child Stars

Although there are child labor laws in California that are designed to protect child stars from exploitation (The Coogan Act), the same protections don't always apply to child YouTube and Instagram stars, or kid influencers. Kid Influencers accounts are usually run by their parents since platforms like YouTube and Instagram have age limits of 13 years old. One consequence of not owning their accounts is that all profits received go directly to the guardians and, unlike traditional child actors in California, these guardians are not required to set aside some of the profits for the children. Advocates like Paul Petersen, believe the legal protections like those in California should apply to children outside of the state. Petersen has said that because YouTube is in San Bruno, California and they are paying to broadcast children, California law must apply to those child stars. Many guardians of kid influencers feel these regulations are unnecessary and that the guardians are doi...

CARU Speaks at Community Board in Manhattan

CARU staff attorney Andra Dallas gave a presentation to Community Board 1, serving lower Manhattan on Monday, December 7 th .  Andra spoke to the Board’s Youth Committee about the importance of teaching children about understanding advertising and safe online practices.  District Manager Noah Pfefferblit remarked, “thank you for your informative presentation to our Youth Committee members,” and offered the Board’s assistance if they “can be helpful to the important efforts at the Children's Advertising Review Unit.” Are you interested in having a CARU staff member visit your community board? Contact adallas@caru.bbb.org.

Kids Internet Design and Safety Act Seeks to Protect Children from Harmful Online Content

United States Senators, Mr. Richard Blumenthal from Connecticut and Mr. Edward Markey from Massachusetts, introduced a new bill referred to as the Kids Internet Design and Safety Act (the “KIDS Act”). One of the Senator’s introducing the KIDS Act, Mr. Edward Markey, was the co-author of the Children’s Online Privacy Protection Act (“COPPA”). The KIDS Act seeks to include noteworthy advertising rules and create new protections for children online, specifically for online users under the age of 16. The proposed advertising rules within the KIDS Act are to ban websites from: (1) exposing young online users to advertisements “with embedded interactive elements”; (2) recommending any content involving alcohol, nicotine, or tobacco to young online users; and (3) recommending content that includes influencer marketing, like unboxing videos, or host-selling to young online users. Additionally, the KIDS Act seeks to prohibit certain online features to protect children, like prohibiting...