Apple Agrees to Refund $32.5 Million for Children?s App Purchases

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Apple Agrees to Refund $32.5 Million for Children?s App Purchases

U.S regulators said Wednesday that Apple has agreed to pay $32.5 million as a refund to U.S customers for all the kids? purchases from its App Store that did not have parental consent.

Modifications to be Done

Apple has also agreed to make some modifications on its practices, the Federal Trade Commission said. Children freely made app purchases on iPad or iPhone just minutes after a password has been entered. This is one issue that Apple is now working on.

Edith Ramirez, chairwoman of FTC, said Apple did not inform parents that there is a 15 ? minute window which allows kids to make app purchases from a dollar to $100 for every app.

This loophole caused millions of dollars in app purchases without the knowledge and consent of parents, Ramirez told reporters. She also added that customers will obtain full redress for every unauthorized charges because many thousands were affected.

Apple Signs Consent Decree

Ramirez said that a consent decree was signed, with Apple setting a minimum of $32.5 million and no maximum. However, if the refunded amount is lower than the said amount, the balance shall be settled with the regulatory agency.

Apple?s chief executive Tim Cook wrote a letter to employees and posted by the 9to5mac website, stating that the company has already followed the practices that the U.S regulators requested.

His memo said that Apple heard the cry of some customers that it was very easy to make app purchases for children to do. This has forced the company to make quick improvements to solve the issue.

Company Sends 28 Million Emails

Apple sent 28 million emails to affected App Store customers to offer a refund. Parents were sent postcards for emails that bounced.

Cook said in his memo that there were 37, 000 claims received. As promised, the company will reimburse each claim.

Robust Relief

Ramirez said that the FTC settlement has provided a more robust relief than the voluntary actions of Apple. Under the agreement, the company must immediately notify parents on the 15 ? minute window that allows children to make app purchases once the password has been entered.

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