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Amazon Starts Refunding $70 Million for Kids' In-App Purchases

Amazon has started sending out refunds for $70 million in unauthorized in-app purchases after settling an FTC suit.
Image: Jeff Bezos speaks during the 32nd Space Symposium
Jeff Bezos, chief executive officer of Inc. and founder of Blue Origin LLC, speaks during the 32nd Space Symposium in Colorado Springs, Colorado on April 12, 2016.Matthew Staver / Bloomberg via Getty Images, file

If your kid racked up hundreds of dollars on your credit card for virtual "gems" on Amazon, your share of $70 million in refunds is finally on its way.

Along with Apple and Google, the ecommerce giant settled with the FTC in 2014 over allegations that it had insufficient safeguards to prevent children from making unauthorized in-app purchases.

These especially included virtual currency in games bought through the Amazon store that gave players a boost.

The FTC's suit explained how "a child may be prompted to use or acquire seemingly fictitious currency, including a 'boatload of doughnuts, a can of stars and bars of gold,' but in reality the child is making an in-app purchase using real money."

This case demonstrates what should be a bedrock principle for all companies — you "must get customers' consent before you charge them," said Thomas B. Pahl, acting director of the FTC's Bureau of Consumer Protection in a press release. "Consumers affected by Amazon's practices can now be compensated for charges they didn't expect or authorize."

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The Amazon store didn't start requiring passwords to make in-app purchases until 2012.

Reached for comment, Amazon spokesman Jonathan Richardson told NBC News in an email:

"Since the launch of the Appstore in 2011, Amazon has helped parents prevent purchases made without their permission by offering access to parental controls, clear notice of in-app purchasing, real-time notification for every in-app purchase and refund assistance for unauthorized purchases."

"The Court here affirmed our commitment to customers when it ruled no changes to current Appstore practices were required," he added. "To continue ensuring a great customer experience, we are happy to provide our customers what we have always provided: refunds for purchases they did not approve. We have contacted all eligible customers who have not already received a refund for unauthorized charges to help ensure their refunds are confirmed quickly."

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Consumer advocates applauded the move.

"It’s taken a long time but we’re glad that the refunds are finally available to parents whose children should not have been able to make these in-app purchases, and that in the meantime Amazon has taken appropriate steps to prevent situations like this from happening again," said Susan Grant, director of Consumer Protection and Privacy for the Consumer Federation of America.

Eligible customers should automatically be receiving emails from Amazon about their refund. If you think you're eligible but didn't get an email, log in to your Amazon account and check the message center. The deadline for submitting refund requests is May 28, 2018.