Apple to pay at least $32.5 million to refund kids' in-app purchases

iPod company agrees to provide full refunds to thousands of consumers to settle Federal Trade Commission complaint related to video game microtransactions.

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Apple has agreed to pay at least $32.5 million in refunds to consumers to settle a Federal Trade Commission complaint brought against the company related to the way in which iOS devices make it simple for children to spend real-world money without parental consent.

The FTC announced the news today on its website.

The original FTC complaint claims that Apple violated the FTC Act by failing to inform parents that by entering their password on an iOS device, they were allowing for 15 minutes of additional unlimited purchases that their children could make without consent.

The FTC's announcement today specifically calls out iOS video games, which often charge for virtual items or in-game currency at a rate of 99 cents to $100, or more. The complaint includes tens of thousands of instances where children spent money without their parents' consent. In one example, one consumer's daughter spent $2,600 in Tap Pet Hotel.

In addition to the fee, Apple must change its billing practices to ensure that it has obtained "express, informed consent" from consumers before they are charged for in-app purchases. Apple must implement these changes no later than March 31, 2014.

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