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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