FTC fined Epic $520 Million for violating Children’s Online Privacy Protection Act.


Epic Games, the maker of Fortnite, has agreed a record $520m to settle Federal Trade Commission allegations that it violated children’s online privacy laws. The company also deceived players into making unintended purchase.

Epic will pay $275 million to be punished for violating Children’s Online Privacy Protection Act. Additionally, Epic will refund $245 million to players who were allegedly duped into purchasing products using design tricks. This settlement is the largest ever for a violation by an FTC rule and the largest refund under the FTC for gambling cases.

Fortnite, a cartoon-like shooter video game, will see major changes as a result of leveling up. Epic will need to make sure teens and children have stronger privacy settings that prevent voice and text communication from being turned off by default. The company should also erase personal information that it allegedly collected without consent from children under 13 and devise a plan for future privacy issues.

Federal Trade Commission commissioners unanimously approved the agreement with Epic. This reflects growing bipartisan concern about Washington’s tech companies allegedly harming children or taking their data. Parents, lawmakers, and child safety advocates are pressing the FTC to make use of the 1998 law’s powers to better protect minors 13 and under on the Internet.

“Protecting the public, especially children, from invasions of online privacy and dark patterns is a top priority for the commission, and these enforcement actions show businesses that the FTC is cracking down on these illegal practices,” said chair Lina Khan (D), a leading industry critic. technology in a statement issued Monday.

Sex, drugs and self-harm: Where 20 years of the Child Online Protection Act went wrong

The settlement could have far-reaching consequences for a host of other tech companies and game makers who rely on so-called “dark patterns” — deceptive design tricks that manipulate users into making certain choices.

The FTC’s decision comes as enforcement agencies around globe consider how to better protect young users online. United kingdom Enact historical rulesIn order to protect minors online in 2021, several US states are following Washington’s lead. A California law requiring users of the internet to provide protections for users younger than 18 years old will take effect in 2024. sues to stop it From into effect.

New legislation has been considered by Congress to improve protections for teenagers and children online. The Children’s Online Privacy Protection Act was created years before the advent of many online platforms that allow young people to spend a lot of their time online.

Epic stated in a press release that “long-standing industry practices are not sufficient” in an environment of rapid change in law enforcement.

The company stated that no developer creates a game with an intention to end up here. “We accepted this agreement because we want Epic to be at the forefront of consumer protection and delivering the best experience for our players.”

FTC filed a federal complaint alleging Epic had collected personal data from Fortnite players aged 13 and under without consent. This was a violation of the Children’s Online Privacy Protection Act (also known as COPPA). FTC claimed that parents had to “jump through unreasonable hoops”, sometimes failing, in order to delete the personal data. The agency claimed that text and voice communication functions are automatically turned on, which exposes children to bullying, threats, and other “painful psychological problems” while they play Fortnite online with strangers.

Epic’s use o “dark patterns” was also the subject of a separate FTC complaint. According to the agency, the player may be charged with trying wake the game from sleep mode. Epic ignored over 1 million complaints by users that they had been wrongly charged, according to the Federal Trade Commission.

Lawmakers and child safety advocates have praised FTC’s work, but warned that it signals Congress’ need to update the decades-old laws that govern how technology companies handle children’s data.

Senator Edward J. Markey (D.Mass), who was one the original authors of COPPA, and who drafted an updated to the Children’s Online Safety Act. “Without immediate action to thwart the insidious threats facing young people, we will fail to protect them in the face of a generation-defining mental health and privacy crisis.”

Child safety advocates called on Congress to include protections of children in the overall spending bill.

“These provisions give teens privacy rights for the first time, address unfair monetization by blocking targeted ads, and empower regulators by creating a dedicated youth section of the Commerce Commission,” said Josh Golin, executive director of Fairplay, a nonprofit focused on protecting children. Federalism”. Marketing.

Many tech companies, including major ones, have paid previous fines for violating Children’s Online Privacy Protection Act. The predecessor to TikTok Musical.lyAnd the Youtube. But the fines—usually in the millions—usually pale in comparison to the billions in revenue tech companies generate annually, and critics have argued they’re seen as the cost of doing business.

Critics of tech industry claimed that Fortnite settlement was a departure.

Sarah Miller, executive director at the American Economic Freedoms Project, which advocates for regulation of tech companies, said this.


An earlier headline stated that the company had reached a settlement with the children’s privacy suit for $520million. The settlement for child privacy was worth $275 million. Rest of $245 million was used to refund players who were duped into making unintended purchase.

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