Epic Games Will Pay $520 Million to Settle FTC Cases About Fortnite’s Privacy Violations and “Deceptive” Monetization

UPDATE: In a recently issued statement, Epic Games has confirmed the settlement of the FTC cases regarding Fortnite, and said that it is continuing to make changes “to ensure our ecosystem meets the expectations of our players and regulators.”

Concerning payment and monetization integration in the game’s UI, the company explains that the game now offers “an explicit yes or no choice to save payment information”, while previous issues with payments being tied to single button pushes have been addressed with the implementation of “a hold-to-purchase mechanic that re-confirms a player’s intent to buy, as an additional safeguard to prevent unintended purchases”, in addition to existing refund token and undo-purchase systems. The company confirms that chargeback policy has also ben updated “to account for non-fraud related scenarios and will only disable accounts when fraud indicators are present”, with “thousands” of accounts banned under the previous policy having been restored.

Epic also points to the implementation of Cabined Accounts, which provide “a tailored experience that is safe and inclusive for younger players” by allowing them to play Fortnite “while they wait for parental consent, but in a tailored environment where certain features, such as chat and purchasing, are disabled.”

“In September, we implemented high privacy default settings for players under the age of 18. Chat defaults to “Nobody,” profile details default to hidden, parties default to “Invite Only,” and personalized recommendations are defaulted Off,” the company adds. “Players under 16 also have the mature language filter defaulted On for text chat.”

You can read the full statement through the link above.

Original story follows:

The United States’ Federal Trade Commission (FTC) has recently been in headlines in gaming circles, having sued Microsoft to block its proposed acquisition of Activision Blizzard. While those proceedings are likely to stretch on for the foreseeable future, the agency has wrapped up proceedings involving another games publisher.

The FTC has announced via a press release that Epic Games will pay a total of $520 million to settle two cases related to Fortnite– one involving privacy violations and the other concerning “deceptive” monetization practices.

As per Samuel Levine, Director of the FTC’s Bureau of Consumer Protection, Epic Games “put children and teens at risk through its lax privacy practices, and cost consumers millions in illegal charges through its use of dark patterns.”

“Under the proposed orders announced today, the company will be required to change its default settings, return millions to consumers, and pay a record-breaking penalty for its privacy abuses,” Levine said.

The company is said to have collected “personal information from children under 13 who played Fortnite, a child-directed online service, without notifying their parents or obtaining their parents’ verifiable consent”, in addition to violating prohibitions “against unfair practices by enabling real-time voice and text chat communications for children and teens by default.”

This case – which is one of two, as mentioned previously – will see Epic Games paying a $275 million monetary penalty.

The FTC also says Epic Games “used dark patterns to trick players into making unwanted purchases and let children rack up unauthorized charges without any parental involvement”. The company is said to have used “counterintuitive, inconsistent, and confusing button configuration” in Fortnite that “led players to incur unwanted charges based on the press of a single button.”

Epic also allegedly “locked the accounts of customers who disputed unauthorized charges with their credit card companies”. Meanwhile, in instances of said accounts being unlocked, players were “warned that they could be banned for life if they disputed any future charges”.

Epic will, as a result, pay $245 million – which will be used to provide refunds to consumers – and will also be prohibited from “charging consumers through the use of dark patterns or from otherwise charging consumers without obtaining their affirmative consent.”