Google has agreed to refund $19m to users of its Play store for Android app purchases made by children without parental permission.
The Federal Trade Commission (FTC) brought the case against Google after Apple was ordered to refund $32m to users in a similar case. It was subsequently discovered Apple had tipped the FTC off about Google.
The issue began in 2011 when Google allowed in-app purchases without any password requirement or other account holder authorisation. From 2012 this was changed to require a password, but it was not clear how much the item cost.
Google also failed to make it clear that once a password was entered, it was then not required again for another 30 minutes. This allowed children to make numerous purchases.
The FTC investigation discovered that Google employees referred to the issue as “friendly fraud” or “family fraud” and that the company would usually redirect any complaints on the issue to the app developer, rather than dealing with them itself.
The FTC said the fine would go some way to reimbursing those who had faced huge bills after discovering their children had made in-app purchases on smartphone and tablet apps without permission.
FTC chairwoman Edith Ramirez added that the fine underlined that consumer protections still apply, even in the digital world. “As more Americans embrace mobile technology, it’s vital to remind companies that time-tested consumer protections still apply, including that consumers should not be charged for purchases they did not authorise," she said.
The agreement is now subject to public comment for 30 days, after which it will be finalised. Once agreed, Google must contact all consumers who placed an in-app charge to inform them of the refund process within 15 days.
If Google issues less than $19m in refunds it must hand over the remaining balance to the FTC for use in providing additional remedies to consumers.
Google said it was pleased that the issue was now concluded: "We've already made product changes to ensure people have the best Google Play experience possible. We're glad to put this matter behind us so we can focus on creating more ways for people to enjoy all the entertainment they love.”
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