Epic Games Fined Over Half a Billion Dollars for Unfair Microtransaction Practices in Fortnite

Epic Games has been hit with a massive fine of over $520 million by the Federal Trade Commission (FTC) for its microtransaction practices in the popular game Fortnite. The fine comes in the form of two separate settlements, with $275 million being levied for violating the Children's Online Privacy Protection (COPPA) rule and an additional $245 million in refunds to be given to customers due to "dark patterns" used in the game.

According to the FTC, Fortnite employed deceptive interfaces and privacy-invasive default settings that tricked players into making unintended in-game purchases. These purchases were often made through confusing button configurations and even while the player was in sleep mode. The FTC also alleges that account holders could be charged without authorization, and that children have racked up significant charges without the knowledge of their parents. Despite receiving over one million complaints about wrongful charges, the FTC claims that Epic purposely obscured cancel and refund features and ignored the complaints.

In addition to the microtransaction issues, the FTC also took issue with Fortnite's voice chat feature. The agency claims that Epic employees urged the company to change the default settings to require users to opt in for voice chat, but that the company resisted turning the feature off even when children were being harassed while playing the game. As a result, Fortnite will now be required to disable voice and text communications for children and teens under 13 or to obtain consent from parents through the privacy setting. Epic must also delete any personal information gathered from Fortnite users in violation of the COPPA rule and establish a comprehensive privacy program.

In response to the settlements, Epic Games issued a statement acknowledging the agreement and noting that the laws governing the video game industry have evolved and industry practices are no longer sufficient. The company also addressed the allegations point by point and stated that it implemented a high privacy default setting in September 2020 and that it plans to make further changes to its payment flow processes.

The FTC's fine against Epic Games serves as a warning to other companies that it will not tolerate deceptive and unfair practices, especially when it comes to children's privacy. It is important for businesses to ensure that they are complying with all relevant laws and regulations, and to be transparent and straightforward with their customers.

In conclusion, Epic Games has been fined over half a billion dollars by the Federal Trade Commission for its unfair microtransaction practices in Fortnite, as well as its handling of children's privacy in the game. The fine serves as a reminder for businesses to prioritize compliance with laws and regulations and to be transparent and honest with their customers.