Epic Games fined over $500 million for Fortnite’s ‘unfair’ microtransactions
Epic Games will pay $520 million for “design tricks…to trick millions of players into making unintentional purchases” in Fortnite, Federal Trade Commission [FTC] announced today.
The fine stems from what the FTC calls two separate “record-breaking” settlements. One is a $275 million fine for violating Children’s Online Privacy Protection [COPPA] impose restrictions on websites and online services directed to children under the age of 13. Epic will also have to pay $245 million in customer refunds for its “dark model.”
According to the FTC, Fortnite uses “privacy-invading default settings” and “deceptive skins” to “trick” players.
FTC Chairwoman Lina Khan said: “Protecting the public, especially children, from online privacy invasions and dark patterns is the Commission’s top priority and real actions are taken. This exam clearly shows businesses that the FTC is cracking down on these illegal practices.”
These “dark patterns” include tricking players into making unintended in-game purchases through “unintuitive, inconsistent, and confusing button configurations”, including being charged charge when waking up from sleep mode. The FTC also says that account holders can be charged without permission, and that children have to pay “hundreds of dollars” in fees before parents are aware of what is going on. In that respect, the FTC says that Epic “ignored more than a million user complaints” about false charges while “deliberately” obscuring cancellation and refund features.
Fortnite’s voice chat settings are also in the spotlight, Epic replies
In addition to microtransactions, Fortnite’s voice chat is in the FTC’s sights. The FTC claims that Epic employees “urged” the company to change Fortnite’s default settings to require users to opt in to voice chat, but the company “resisted” turning the feature off. even when children are “harassed, including sexually, while playing games.”
As a result, Fortnite will be required to disable voice and text communication for children and teens under 13, or for parental consent via privacy settings. Epic must also delete personal information collected from Fortnite users in violation of COPPA rules and to establish a “comprehensive privacy program”.
Epic published a lengthy response of its ownsaid in part, “No developer makes a game with the intention of ending here. The video game industry is a place of rapid innovation, where player expectations are high and new ideas are paramount. Laws written decades ago don’t specify how the game ecosystem should work. Laws haven’t changed, but their application has evolved and long-standing industry practices are gone. We’re accepting this deal because we want Epic to take the lead in protecting consumers and providing the best experience for our players.”
Epic went on to address the allegations point-by-point, saying that “all game developers should rethink the steps they’ve taken to simplify payment flows” and noting that it has implemented set a high privacy default in September. Epic also lists what it says is an updated refund policy, self-service refunds, instant cosmetic cancellations, and “no item loot boxes random pay since 2019 and never had gambling.”
The fines are further evidence of the FTC’s growing attention to the video game industry, including sue to block Microsoft’s attempt to acquire Activision Blizzard. While, Epic has been locked in multiple lawsuits with Apple and Google on issues like Apple taking 30% from both apps and in-app purchases.
Fortnite recently kicked off Chapter 4described as a “fresh start” thanks to a major overhaul of the graphics and other updates.
This story has been updated with Epic’s response to the FTC’s settlements.
Kat Bailey is a Senior News Editor at IGN and a Nintendo Voice Chat co-host. Got a tip? Message her directly at @the_katbot.