In-App Purchases Lead To Huge FTC Settlements For Google

The Federal Trade Commission has been filing complaints against tech giants like Google, Apple, and Amazon due to the way these companies handle in-app transactions. It seems that thousands of parents in the United States have received horrifying mobile bills when their children get a hold of devices and buy in-app game power-ups and virtual money, all without the adults knowing.

Google has been the latest to pay out a large settlement due to these controversies. On September 4, the FTC posted a notice stating that Google would refund parents more than $19 million for unauthorized mobile transactions, which generally stem from children’s unauthorized purchases.

Many mobile games for iOS and Android platforms capitalize on in-app purchases. These are the power-ups, special characters, and virtual funds that you can buy for real money. Some games make it extremely difficult or impossible for players to advance to higher levels without making a purchase or two. Hapless parents who give their children access to mobile devices might not realize just how often their youngsters hit pay walls.

It seems pretty obvious that a child will hit whatever combination of buttons they need to continue playing the game, even if it winds up on their parents’ credit cards. These unauthorized purchases are known as “family fraud” in the tech community. Early Google Play policies did not require user reauthorization for in-app purchases, leaving children to spend to their hearts’ content. Eventually, a sign-in popup box would appear before transaction, but this gave users a 30-minute grace window, during which they could make additional purchases.

You can take proactive measures and keep your mobile purchases under control with parental controls. Android users can set up restricted profiles by diving into their settings menu and creating profiles for their children. In addition to restricting certain apps, parents can disable in-app purchases and filter content by age ratings. Parents can also completely disable the installation of apps on their devices. These settings can prevent slip-ups and help ensure that your next credit card bill isn’t a surprise.

According to the FTC report, Google will not be able to refer parents to the app developers for refunds. Refunds must be issued by Google, and parents should have a 15-day window to pursue a refund. While there haven’t been details about specific features, Google is also expected to revise its mobile billing processes, so that in-app transactions are more transparent to users. These efforts should prevent unauthorized family purchases from slipping past a parent’s radar.

Google’s recent settlement demonstrates that the FTC is relentlessly pursuing tech companies and holding them accountable for consumer billing issues, such as family fraud. It can be all too easy for children to rack up hundreds of dollars in charges by playing popular mobile games. Earlier this year, Apple also settled with the FTC regarding in-app purchases. Hopefully, these legal processes and fines will help parents gain control over their app store accounts again. If you’re concerned about unauthorized in-app purchases, you can restrict transactions from happening by modifying your Google Play and profile settings.