Thursday, January 16, 2014

Apple ordered to refund parents for kids' in-app purchases

Apple has agreed to refund at least $32.5 million to the US customers to settle a Federal Trade Commission complaint that the company billed consumers for app purchases by children without their parents’ consent.
Under the terms of the settlement with the FTC, Apple also will be required to change its billing practices to ensure that it has obtained express, informed consent from consumers before charging them for items sold in mobile apps. 
Apple was found to have violated the FTC Act by failing to tell parents that by entering a password they were approving a single in-app purchase and also 15 minutes of additional unlimited purchases their children could make without further action by the parent.
In addition, Apple often presented a screen with a prompt for a parent to enter his or her password in a kids' app, without explaining to the account holder that password entry would finalise any purchase.
According to the FTC, Apple has received 'at least tens of thousands of complaints' about unauthorised in-app purchases by children. The company must make the changes to its billing practices by March 31 and will have 12 months to inform and refund customers affected by the previous system.

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