Mobile

Amazon to Refund $70 Million for In-App Purchases Made by Kids

• By Sri Ravipati
• 04/06/17

Amazon Inc. will refund millions of unauthorized in-app purchases made by kids on mobile devices. According an announcement from the Federal Trade Commission (FTC) earlier this week, more than $70 million in in-app purchases made between November 2011 and May 2016 may be eligible for refund.

The news comes after the online retail powerhouse dropped its appeal of last year’s ruling by a federal judge that sided with the FTC’s lawsuit against Amazon. In April 2016, Judge John Coughenour found that Amazon had billed consumers for unauthorized in-app charges incurred by children using Amazon mobile apps. The court ruled that Amazon failed to get parents’ consent for these charges, according to the FTC statement. The same ruling also denied the FTC’s request for an injunction to prevent Amazon from similar conduct in the future. The FTC appealed the denial of the injunction, but this week ended the appeal.

The commission’s suit against Amazon followed similar cases against Apple Inc. and Google Inc. Both companies settled before the cases went to course and agreed to refund unauthorized in-app charged incurred by children.

As for Amazon, “the decision by the FTC and Amazon to end their litigation will allow the refund process to begin shortly,” according to the FTC statement. “Details on the refund programs, which Amazon will operate, will be announced shortly.”

“This case demonstrates what should be a bedrock principle for all companies — you must get customers’ consent before you charge them,” said Thomas B. Pahl, acting director of the FTC’s Bureau of Consumer Protection. “Consumers affected by Amazon’s practices can now be compensated for charges they didn’t expect or authorize.”