The FTC sued Amazon Thursday, July 3rd, 2014 for allowing children to make in app purchases that totaled up to the millions using their parents' credit cards. The lawsuit filed by the FTC seeks to force the retailer to refund the monies that were spent without the parents' knowledge. The suit also wants to make sure Amazon purchasing practices are changed to ensure that this unfortunate situation never arises again.
The unauthorized charges were usually used on children's mobile gaming apps such as "Tap Zoo". These games are free to download but players are able to make app purchases such as buying boosts, specialty items or coins.
The FTC suit specifically mentions Tap Zoo and Ice Age Village, where the children manage a zoo or a city. While caring for their zoo or ancient city, there are digital items that are for sale, but these digital items that help their digital society costs real money.
The FTC settled a similar case with Apple in January. Apple agreed to refund $32.5 million to their customers whose children made unauthorized charges. Apple has since altered their billing practices as well, they now require parental consent in order to complete an in app purchase.
Amazon has yet to speak on the issue but, have referred us to a letter written by Andrew DeVore, its vice president and general counsel. In the letter to the FTC he states that the FTC threat to sue, leaves them no choice but to defend our approach in court.
The FTC stated in their complaint that Amazon responded to previous complaints by requiring passwords in order to make a purchase. However, a purchase window remains open for up to an hour allowing other charges to be made without requiring anyone to re-enter their passwords.
An Amazon official was quoted to have said that "We believe that parents are excluded from the buying process for these apps".