FTC Sues Amazon Over In-App Purchases

Posted by at 11:13 am on July 10, 2014

The U.S. Federal Trade Commission today made good on its word to sue Amazon over the company’s in-app purchasing policies.

The FTC alleges Amazon didn’t provide consumers with enough protection against unwanted in-app purchases. Specifically, children were frequently able to make purchases on Amazon Kindle Fire tablets without first obtaining their parent’s (or the account holder’s) permission. Amazon initially allowed in-app purchases up to $99.99 without requiring consent. Later, after some customers complained, Amazon dropped the maximum no-authorization dollar amount of in-app purchases to $20.

The FTC says, however, that Amazon allowed in-app purchases for periods between 15 minutes and 60 minutes after account holders gave the app permission to make purchases, which often allowed children to rack up more charges. The FTC is seeking refunds for customers, and wants Amazon to make its in-app purchasing policies more consumer friendly.

Earlier this year, Apple settled a similar complaint with the FTC by paying $32.5 million. Amazon said earlier this month that it will defend itself in court against any legal action brought by the FTC. Amazon is prepared to release its first smartphone, the Fire Phone, later this year.

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