Epic Games Agrees To Pay Whopping $525M To Settle FTC Charges

• On Monday morning, the FTC made the settlement announcements. 
• The FTC is sending a strong message to companies through this enforcement.

The developer of the massively popular online action game Fortnite, Epic Games, has agreed to pay $520 million to resolve FTC charges that it failed to take adequate measures to safeguard children’s privacy in the game and engaged in misleading conduct with respect to in-game purchases.

On Monday morning, the FTC made the settlement announcements. The $520 million total includes a $275 million penalty for breaking COPPA and a $245 million refund to subscribers due to what the FTC deems “dark patterns and billing practices.”

Strong Message to Firms

Moreover, FTC Chair Lina M. Khan stated in a statement that “Epic used privacy-invasive default settings and deceptive interfaces that tricked Fortnite users, including teenagers and children.”  The FTC is sending a strong message to companies through these enforcement actions that it will not tolerate illegal behavior.

The agency claims that Epic Games knowingly acquired personal information from children under the age of 13 without obtaining parental consent, leading to the record-breaking COPPA penalty. The agency also alleges that Epic made it difficult for parents who wanted to remove such data later on and didn’t always comply with their requests.

More worryingly, Epic Games has allowed voice and text chat for young gamers by default, opening them up to the risk of abuse from other players. In the second settlement, Epic paid out hundreds of millions of dollars to settle FTC charges that it utilized a “counterintuitive, inconsistent, and confusing button configuration” to induce users to make inadvertent in-game purchases.

In addition, it let minors buy V-Bucks, Fortnite’s virtual currency, without parental consent and would disable accounts of players who contested such transactions with their credit card companies.

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