Fornite Creator Epic Games to Pay $520 Million Fine Over Privacy Violations and Misleading Purchases
Reading Time: 2 minutesCreator of Fortnite, Epic Games, is to pay a $520 million fine in a huge FTC settlement.
Video game company Epic Games, creator of Fortnite, has been slapped with a $520 million fine by the FTC for misleading users into making unintended purchases and breaking a child privacy law.
Epic Games Is Fined $275 Million for Violating a Child Privacy Law
The US Federal Trade Commission (FTC) has fined video game company Epic Games a mammoth $520 million for allegedly violating a child privacy law and allegedly misleading users into making unwanted purchases.
The FTC accused Epic Games of violating the Children’s Online Privacy Protection Act of 1998 (COPPA), which, as stated on the Code of Federal Regulations website, prevents the ‘gathering of any personal information from a child by any means’. Individuals under the age of 13 are protected by this law.
In the same complaint, it was also written that ‘matchmaking children and teens with strangers while broadcasting players’ account names and imposing live on-by-default voice and text communications has caused substantial injury’.
In an official FTC complaint, it was stated that ‘Epic failed to comply with the COPPA Rule’s parental notice, consent, review, and deletion requirements.’ For this, Epic Games will have to pay a $275 million fine.
Epic Games Must Pay an Additional $245 Million in This Settlement
On top of the aforementioned $275 million fine, Epic Games must also pay a $245 million penalty for allegedly misleading users into making unwanted purchases.
In a complaint made by the FTC regarding the issue, it was stated that the interface used by Fortnite was designed in a fashion that used ”dark patterns” to charge customers ‘without first obtaining their express informed consent’. It was also written that ‘Millions of consumers have complained to Epic about these unfair practices’.
This $245 million fine will go toward the customers who lost money via these unintended purchases.
Epic Games must now also ask users whether they want to have their payment information saved for future use, instead of saving it automatically.
Epic Games Made Its Own Statement About the Penalty
Epic Games is no stranger to legal entanglements, having battled Google in a previous lawsuit, as well as Apple.
In the case of this most recent FTC fine, Epic Games somewhat defended itself in a blog post regarding the incident, stating that ‘Statutes written decades ago don’t specify how gaming ecosystems should operate. The laws have not changed, but their application has evolved and long-standing industry practices are no longer enough’.
However, the company then wrote that it accepted the administrative order because it wants to be ‘at the forefront of consumer protection and provide the best experience for [its] players.’
This Marks the Largest Ever FTC Administrative Order
This $520 million penalty charged to Epic Games stands as the largest FTC administrative order in history. As online gaming continues to grow in popularity, the breach of player privacy and consent continues to be a concern for lawmakers and users alike.
Reference: https://www.makeuseof.com/fornite-creator-epic-games-to-pay-520-million-fine/