Epic Games, developer of the popular online video game Fortnite, has agreed to a record-breaking $520 million settlement over allegations of violating children’s privacy, exposing them to harassment and bullying, and misleading millions of young players into making unintended in-game purchases, US regulators said Monday.
The two-part settlement was announced by the Federal Trade Commission (FTC). The gaming giant has been accused of violating the Children’s Online Privacy Protection Act (COPPA) by collecting personal data from players under the age of 13 without obtaining verifiable consent from their parents or guardians. To resolve claims that it violated children’s privacy, Epic will pay $275 million to the US government.
“The company also required parents who requested that their children’s personal information be deleted to jump through unreasonable hoops, and sometimes failed to honor such requests,” the FTC said.
Additionally, the regulators highlighted Fortnite’s default text and voice communication settings, which matched children and teens with strangers to play the game together, exposed them to bullying, harassment, threatening, and exposure to “dangerous and psychologically traumatizing issues such as suicide while on Fortnite”.
The FTC said despite concerns from employees and reports that children had been harassed, including sexually, Epic resisted turning off the default settings.
“And while it eventually added a button allowing users to turn voice chat off, Epic made it difficult for users to find.”
The second case concerns manipulation and deceptive practices. Fortnite, which has over 400 million global users, is free to download but charges players for in-game purchases, including costumes and dance moves for characters. According to the FTC, the developer earned millions of dollars through “dark patterns” – online techniques that tricked users into making unintended purchases.
“The company has deployed a variety of dark patterns aimed at getting consumers of all ages to make unintended in-game purchases,” the FTC said. “Fortnite’s counterintuitive, inconsistent, and confusing button configuration led players to incur unwanted charges based on the press of a single button.”
Players could be charged while attempting to wake the game from sleep mode, while the game was in a loading screen, or by pressing a side button while simply trying to preview an item, the FTC noted.
“Epic put children and teens at risk through its lax privacy practices, and cost consumers millions in illegal charges through its use of dark patterns,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection. “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.”
The statement also added Epic ignored over one million user complaints and repeated concerns from employees that users were being charged wrongfully.
According to reports, Fortnite, recently valued at $32 billion, made $3.7 billion and $5.5 billion in 2019 and 2018, respectively.
