Epic Games Has Been Slapped With A Record-Breaking $520M Fine By The FTC
The US Federal Trade Commission has ruled against Epic Games following allegations that the Fortnite developer violated player privacy under the Children’s Online Privacy Protection Act and that it used “dark patterns” to trick players into buying items from the cash shop. The company is now being forced to pay a whopping $520 million in refunds and penalties in two separate settlements.
The first settlement amounts to $275 million for violating the COPPA and is the largest penalty ever imposed for the violation of an FTC rule. The settlement also requires Epic to introduce strong privacy default settings for underage players, which the company plans to implement through the new Cabined Accounts feature.
The second settlement forces Epic to issue $245 million worth of refunds to users who were duped by the company’s use of dark patterns and deceptive monetization practices. It’s also the largest ever refund amount that the FTC has levied on a video game.
“As our complaints note, Epic used privacy-invasive default settings and deceptive interfaces that tricked Fortnite users, including teenagers and children,” said Lina Khan, the current Chair of the FTC. “Protecting the public, and especially children, from online privacy invasions and dark patterns is a top priority for the Commission, and these enforcement actions make clear to businesses that the FTC is cracking down on these unlawful practices.”
Epic responded to the settlement with a statement saying that, “No developer creates a game with the intention of ending up here. The laws have not changed, but their application has evolved and long-standing industry practices are no longer enough.”
The company goes on to outline some of the changes that it’s made to its payment and refund systems, including the addition of a “hold to buy” feature to prevent accidental purchases and the recently announced Cabined Accounts feature for players under 13 years of age.
In addition to the recent settlement, Epic Games is also at the receiving end of a class-action lawsuit filed by Calex Legal in Montreal, Canada on behalf of the parents of two minors over Fortnite’s allegedly addictive nature.
