Epic Games Fined by FTC for COPPA Violations

Epic Games will have to cough up $520 Million in fines in a settlement with the FTC due to violations of the Children’s Online Privacy Protection Act (COPPA) and allegations that they deployed design tricks known as ‘dark patterns’ to dupe millions of players into making unintentional purchases.

FTC alleges that Epic pairing children and teens with strangers and failing to introduce parental control systems exposed them to dangerous and psychologically traumatizing issues. "As our complaints note, Epic used privacy-invasive default settings and deceptive interfaces that tricked Fortnite users, including teenagers and children," said FTC Chair Lina M. Khan. Settings such as voice and text communication were on by default, which was a huge privacy risk already, only to be amplified by the fact that despite knowing a large part of the player base was underage, Epic did not take sufficient steps to receive consent from the parents to gather data and did not introduce proper parental control methods.

Epic allowed children to purchase V-bucks by simply pressing buttons, without requiring authorization or any action from the card holder, which led to the children racking up several hundreds of dollars in charges before the parents noticed. From the fine, 245 million will go towards refunding affected consumers, which is the FTC’s largest refund amount in a gaming case while 275 million will be paid to the government as a monetary penalty, making it the largest ever penalty obtained for violating and FTC rule.

Furthermore, a proposed federal court order will prohibit Epic from enabling voice and text communications for children and teens unless parents provide their affirmative consent through a privacy setting. They must also delete all personal data previously collected from this practice. This serves as a warning to both the companies and its users on how to responsibly operate and use gaming services.

This article is written by Gaurav Advit.