Fortnite creator Epic Games fined $520 million in record-breaking FTC settlement

Epic Games Inc., the video game developer behind Fortnite, has agreed to pay $520 million to settle allegations from the Federal Trade Commission that it violated online privacy laws for children and purposely misled customers into making unintended purchases, The Wall Street Journal reports.

The agreement covered two separate civil complaints the FTC had filed against Epic. The first complaint alleged that the company violated the federal Children's Online Privacy Protection Act by collecting personal information from Fortnite players under 13 without obtaining parental consent. The lawsuit also claimed that the game illegally defaulted to enabling voice and text chat communication features for minor players. The FTC said Epic put children at risk by exposing them to strangers, leading some kids to be "bullied, threatened, harassed, and exposed to dangerous and psychologically traumatizing issues such as suicide." Epic will be charged a $275 million fine for the alleged COPPA violations, the largest civil penalty linked to the privacy law, per the FTC.

The second complaint, filed in administrative court, alleged that the company engaged in "dark patterns," or tactics that trick players into paying for goods and make it difficult to cancel the transaction. The FTC said Epic used a variety of tricks to drive unintended purchases in Fortnite, including inconsistent and confusing button configurations. "These tactics led to hundreds of millions of dollars in unauthorized charges for consumers," the FTC said in the complaint. Epic agreed to refund $245 million to customers to resolve this complaint.

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"No developer creates a game with the intention of ending up here," Epic said. "We accepted this agreement because we want Epic to be at the forefront of consumer protection and provide the best experience for our players."