Apple Inc. (AAPL) has agreed to $32.5 million settlement over in-app purchases

Posted Jan 15, 2014

Around three years ago, the Federal Trade Commission (FTC) started investigating the way that Apple Inc. (NASDAQ:AAPL) in-app purchases worked. Children being able to buy in-app purchases without permission from parents was very simple back then. In a few circumstances, children ran up to hundreds and even thousands of in-app virtual goods. Apple has agreed to pay $32.5 million as part of a settlement.

?As a result, we have alleged that in aggregate, children ran up millions of dollars in charges without knowledge or consent,? stated FTC Commissioner Edith Ramirez as quoted by Ars Technica.

Ramirez said that the settlement received a 3-1 vote. Apple will be providing refunds and the payments much reach a “$32 million price floor, and if it comes to less, then Apple will pay the rest to the FTC.” Apple lacked informed consent that there was a 15-minute window between the time that parents logged into iTunes for the session to expire. In those 15 minutes, children were able to buy many items. ?Apple is required to send out an e-mail to potentially affected consumers,? added Ramirez.

Apple CEO Tim Cook said that the company already e-mailed millions of App Store customers and is processing around 37,000 claims. Apple agreed to changing their billing practices to make sure that they have obtained “informed consent” from consumers before charging them for items within mobile apps.