Fortnite maker Epic Games pays record $520 million for violating children's privacy

Fortnite maker Epic Games has agreed to pay an eye-watering $520 million settlement over allegations that it misled players, including children, into making unintended purchases and that it breached children’s privacy law.

The agreement is split into two amounts, with $275 million going to the US government to resolve claims it violated the Children’s Online Privacy Protection Act (COPPA) - the amount is the largest penalty ever obtained for violating an Federal Trade Commission (FTC) rule.

And the second amount, of $245, will cover refunds for customers who were allegedly harmed by its ‘dark patterns and billing practices’. The FTC says the figure is the largest refund amount ever in a gaming case.

TC Chair Lina M. Khan said in a statement: "As our complaints note, Epic used privacy-invasive default settings and deceptive interfaces that tricked Fortnite users, including teenagers and children.

"Protecting the public, and especially children, from online privacy invasions and dark patterns is a top priority for the Commission, and these enforcement actions make clear to businesses that the FTC is cracking down on these unlawful practices.”

Epic Games

Fortnite is free to download, but players can buy in-game items such as dance moves and skins.

In its complaint, the FTC alleged Epic Games had breached COPPA ‘by collecting personal information from children under 13 who played Fortnite, a child-directed online service, without notifying their parents or obtaining their parents’ verifiable consent’.

The filing also claimed that the company had used ‘dark patterns’ to ‘trick players into making unwanted purchases and let children rack up unauthorised charges without any parental involvement’.

In a post about the settlement agreement on its site, Epic Games said: “No developer creates a game with the intention of ending up here.

Epic Games

"The video game industry is a place of fast-moving innovation, where player expectations are high and new ideas are paramount. Statutes written decades ago don’t specify how gaming ecosystems should operate.

“The laws have not changed, but their application has evolved and long-standing industry practices are no longer enough. We accepted this agreement because we want Epic to be at the forefront of consumer protection and provide the best experience for our players.

“Over the past few years, we’ve been making changes to ensure our ecosystem meets the expectations of our players and regulators, which we hope will be a helpful guide for others in our industry.”