Apple to Refund $32.5 Million over In-App Purchases

Apple’s App Store racked up over $10 billion in sales last year, but not all of those sales were intentional. The company has reached an agreement with the Federal Trade Commission to refund at least $32.5 million to customers over in-app purchases. This agreement settles a complaint from the FTC that Apple charged customers millions of dollars for in-app purchases made by children without parental consent.

Though Apple previously added a password requirement for purchases, the FTC has a problem with the fact that it’s possible to make additional purchases in a 15 minute window without entering the password again. While Apple requires the password for the initial purchase, it does not indicate that the password will remain active for the following 15 minutes.

Naturally, children quickly discovered the loophole. Though a parent may have only meant to make a single purchase, children were then able to make additional unauthorized purchases adding up to millions of dollars. The FTC cites an example of a customer whose daughter spent $2,600 in the app “Tap Pet Hotel,” as well as stories of kids racking over $500 in purchases in apps such as “Dragon Story” and “Tiny Zoo Friends.”

Aside from refunding millions, Apple must change its billing methods and make sure it has “express, informed consent” for all purchases. Customers must also have the option of withdrawing their consent at any time. Apple has until the end of March to implement the changes, though it shouldn’t be a problem as CEO Tim Cook said that the agreement with the FTC “does not require us to do anything we weren’t already going to do.”

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