$70 Million Refund From Amazon If Your Kid Made Unauthorized In-App Purchases

( [email protected] ) Apr 06, 2017 04:46 PM EDT
Did you go through an unprecedented level of stress when you discovered how your little one racked up hundreds or even thousands in in-app purchases on Amazon? Fret not, Amazon is ready to disburse up to $70 million in refunds.
Amazon dominated the Cyber Weekend with a 30.9 percent share of online sales compared to other retail stores. Best Buy came in second with 7.4 percent from last year's 6.1 percent. Claudio Toledo via Flickr

Amazon is a rich company, so $70 million is no big deal for them. However, it means a lot to parents of children who performed in-app purchases without their knowledge. It is a nice gesture (albeit a forced one) by Amazon to foot the bill for all certified unauthorized purchases that your children made with your Amazon account. Well, with some outside ‘help’, of course. The Federal Trade Commission (FTC) did sue Amazon in July 2014, touting that the e-commerce giant’s app store enabled children to perform illegal purchases from within mobile apps, including but not limited to online games, without having to seek consent from their parents before that. The only way the parent would be able to find out is through bank statements -- which was too late to do anything about it, as Amazon’s policy clearly states that all in-app charges are strictly non-refundable.

Well, in April last year, a federal district court did make the ruling that the unwitting customers were able to seek damages from Amazon. At least the FTC and Amazon have finally decided to put an end to the litigation concerning the case last year, and Amazon is prepared to offer a compensation to the tune of $70 million to disgruntled parents -- covering in-app charges that were made between November 2011 and May 2016.

So far, Amazon has not stepped forward to provide a formal answer to this development, and according to the FTC, crucial details on claiming the refund will be made in a short while. Thomas B. Pahl, acting director of the FTC’s Bureau of Consumer Protection, shared, “This case demonstrates what should be a bedrock principle for all companies—you must get customers’ consent before you charge them.” That sounds about right, and it is nice to see the right side of the law being applied in this particular case.

In the past, the FTC has sent somewhat similar allegations in the direction of Apple and Google, citing that it was unlawful for these companies to bill the parents of children who performed illegal in-app purchases without their parents’ prior knowledge. So far, we do know that Apple has agreed to issue a minimum refund to the tune of $32.5 million and, while Google had to stump up more than $19 million in order to settle the case. It certainly took some more time for Amazon to arrive at the same conclusion, but better late than never.

As parents, it is first and foremost your responsibility to ensure that your children know what they are doing with the apps that they use. If you know your children well enough and their character, why not make sure that they understand that certain apps are off limits for such reasons, and make it so? This is to minimize the part of anything untoward or unsavory happening, such as illegal in-app purchases.

At least this should serve as a notice for other companies who would like to prey on the naivete of the young ones who are more accessible to devices than ever before in this day and age.

Tags : Amazon, Amazon Prime