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Amazon illegally billed parents for kids' in-app purchases, judge rules

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Sean O'Kane

Amazon illegally billed parents around the US for allowing their children to make in-app purchases without their knowledge or permission, a federal judge ruled on Tuesday. The judge decided in favor of the Federal Trade Commission, agreeing with its complaint that Amazon surprised consumers with charges because it failed to sufficiently inform them that games labeled "free" could later allow purchases to be made.

The FTC has been going after every major app store

The case will now continue as Amazon and the FTC work out damages. The FTC is hoping to make Amazon fully refund purchases made by children, starting from the launch of in-app purchases in November of 2011 all the way to June of 2014, when Amazon finally added more thorough disclosures and prompts. Amazon did not immediately respond to a request for comment.

Amazon had been receiving complaints about surprise in-app purchase billing prior to its changes in 2014. At first, it hadn't warned customers of the existence of in-app purchases at all. Eventually it began to present smaller notices and occasionally require a password, but the FTC argued that both were insufficient. Later on, Amazon began presenting a pop-up requiring authorization upon making a first in-app purchases.

The FTC filed its case against Amazon in 2014. That same year, it settled with both Apple and Google over this very same issue. Between the two, it recovered consumer refunds topping $50 million.