Court: Amazon Must Refund Parents for Kids’ Unauthorized Purchases

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A federal judge ruled that the e-commerce giant is liable for big bills run up by children without their parents' knowledge on apps advertised as "free."

If you have a kid who — unbeknownst to you — racked up hefty in-app charges on “free” apps on Amazon a few years back, we have good news. You’ll likely be receiving a refund from Amazon for those unauthorized charges.

According to the Federal Trade Commission, a judge ruled that Amazon is liable for billing unsuspecting parents for their kids’ unauthorized in-app charges. The federal judge’s ruling effectively ends a two-year legal battle over the charges.

“We are pleased the federal judge found Amazon liable for unfairly billing consumers for unauthorized in-app purchases by children,” FTC Chairwoman Edith Ramirez said in a statement.

In-app purchases allow users to purchase virtual items — like coins, stars, extra levels or songs, or game hints — within a free or paid game or app. However, it can sometimes be difficult for users to distinguish whether the items cost real dollars or virtual game currency, and especially for children.

Many parents also felt like they were bamboozled because many of the in-app charges came from supposedly “free” apps. While the apps may have been free to download and play, sometimes an in-app purchase is required to help the user pass a level or purchase more “lives.”

There’s no word yet on how much Amazon will have to pony up to settle the liability. But the FTC said it plans to push for full refunds for affected Amazon customers.

Although Amazon started billing for in-app charges in November 2011, it wasn’t until June 2014 that the online retail giant required consumers’ informed consent on its newer devices for all in-app purchases.

During that near three-year period, the FTC says millions of dollars of unauthorized purchases by children were made through Amazon’s app store.

Google and Apple have settled similar claims regarding unauthorized in-app purchases with the FTC.

In December 2014, the FTC ordered Google to refund $19 million to consumers for unfairly billing them for in-app purchases racked up by their kids without their consent.

Two years ago, after the FTC and Apple received thousands of complaints about kids’ in-app purchases from the Apple App Store, the tech giant agreed to improve its parental controls and refund a minimum of $32.5 million to consumers. Apple also replaced the “free” button in its app store with a “get” button in an effort to keep parents better informed about the potential cost of in-app purchases.

I have passwords on all my electronic devices, including my iPhone, Kindle and an iPad, so my kiddos aren’t able to rack up any big charges for in-app purchases in so-called free apps. I also sometimes turn my devices’ Wi-Fi off and put them in “airplane mode” so my children aren’t able to inadvertently make a purchase or connect to the internet.

I have a friend whose then 7-year-old son used his Kindle Fire to rack up hundreds of dollars of in-app purchases on Amazon without her knowledge. She didn’t dispute the charges with Amazon, but she did have a serious discussion with her son about making in-app purchases on Amazon without asking her permission first.

What do you think about the judge’s ruling? Has your child made unauthorized purchases on a Kindle, iPad or other electronic device? Share your comments below or on our Facebook page.

Stacy Johnson

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