The Federal Trade Commission (FTC) has secured agreements requiring Epic Games, the creator of Fortnite, to pay $520 million in relief over allegations that the company violated the Children's Online Privacy Protection Act (COPPA). The company is said to have deployed design tricks, known as dark patterns, to dupe millions of young players into making unintentional purchases and by collecting personal information from children under 13 without notifying their parents or obtaining their verifiable consent. The company also violated the FTC Act's prohibition against unfair practices by default enabling real-time voice and text chat communications for children and teens. Epic is said to have also been aware that many
children were playing Fortnite through various sources that required parents to go through
unreasonable steps to request the deletion of their children's personal information, and in some cases would fail to honor such requests. The FTC alleges that Epic's default settings, which enable live text and voice communications for users, along with the company's role in matching children and teens with strangers to play Fortnite, harmed children and teens through bullying, threatening, harassing, and exposing them to dangerous and psychologically traumatizing issues.
As a lesson to businesses, it is important to prioritize customer privacy and fair practices and to avoid violating children's privacy laws and employing tactics that could potentially trick users into making unwanted charges. Businesses should also be aware of the FTC's COPPA Rule, which requires online services directed at children under 13 to obtain parental consent before collecting personal information from children. In addition, businesses should carefully consider their default privacy settings and ensure that they are not putting children at risk of harm.
To avoid similar consequences, businesses should regularly review and update their privacy practices and policies to ensure compliance with relevant laws and regulations. They should also be transparent about the collection and use of personal information, and provide clear and easy-to-understand options for users to opt-in or opt-out of certain features or data collection. By being proactive in protecting customer privacy, businesses can avoid costly settlements and damage to their reputation, and establish trust and credibility with their customers.
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