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Thursday, January 16, 2014

US Federal Trade Commission and Apple agree consumer refunds for in-app purchases

The US government's Federal Trade Commission says Apple has agreed to pay at least $32.5 million (just under £20 million) in refunds to customers who paid for in-app purchases downloaded by children without their parents’ consent. In addition, Apple is now required to ensure "that it has obtained express, informed consent from consumers" before charging them for items sold in mobile apps. It follows a two-year investigation period.

According to the FTC, Apple failed to tell parents that approving a single in-app purchase also meant they were allowing 15 minutes of potentially unlimited purchases by their child.

Edith Ramirez, who chairs the FTC, said “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.”

However, an internal email from Apple CEO Tim Cook notes that the company has already taken action. According to 9to5mac.com, Mr Cook wrote "It doesn’t feel right for the FTC to sue over a case that had already been settled. To us, it smacked of double jeopardy. However, the consent decree the FTC proposed does not require us to do anything we weren’t already going to do, so we decided to accept it rather than take on a long and distracting legal fight."

[FTC/Apple agreement (pdf)]

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Author: The Fonecast
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