to join the CVG community. Not a member yet? Join now!

Apple must refund $32.5 million for kids' in-app purchases

FTC says Apple did too little to stop unauthorized spending

Apple must refund at least $32.5 million to parents whose children made in-app purchases on iOS devices without their consent, the FTC announced Wednesday.

The tech firm did not take sufficient steps to ensure purchases made by children were knowingly authorized by their account-holding parents, the FTC alleged. It took particular issue with the App Store's policy of letting users enter their passwords once for a single purchase then continue to make purchases throughout a 15-minute window.


The FTC said tens of thousands of parents complained to Apple about unauthorized in-app purchases made by children, including one consumer whose daughter reportedly spent $2,600 in Tap Pet Hotel. Apple must contact affected users and refund at least $32.5 million in purchases within the next 12 months or surrender the remaining balance to the FTC.

This settlement also means that Apple must change its in-app purchase policies to make it more difficult for children to make without parental permission. However, Apple CEO Tim Cook said in a letter to employees posted by 9to5Mac the firm was already taking steps to address the FTC's issues before settling the complaint and is in the process of reimbursing 37,000 claims.

"It doesn't feel right for the FTC to sue over a case that had already been settled," Cook wrote. "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."

Apple announced on January 7 that the App Store has brought in $15 billion for developers since it opened in 2008, clearing $10 billion in total revenue in 2013 alone.