FTC reportedly planning 'record-setting' fine on Facebook for mishandling user data
Brett Larson reports on what the future holds for the social media giant.
Facebook allowed children to run up massive bills on digital games, according to newly released court documents. The records also show that the tech giant rejected recommendations to tackle what it described as "friendly fraud."
The documents, which include internal company memos, were released late Thursday as a result of legal action by the Center for Investigative Reporting’s Reveal publication.
The class-action lawsuit centers on allegations that Facebook knowingly gouged teenagers by permitting them to spend hundreds of dollars buying additional features on games such as "Angry Birds" and "Barn Buddy."
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The memos and other records show that “the company orchestrated a multi-year effort that duped children who played video games into spending their parents' money,” according to Reveal.
The records reveal, for example, that one 15-year-old ran up charges of $6,545 while playing games on Facebook for just over two weeks.
The social network considered measures to reduce the chances of kids running up charges on parents' credit cards without their knowledge, according to the documents. However, Facebook didn't adopt them for fear of undercutting revenue, the records say.
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One company memo even states: “Friendly Fraud – what it is, why it’s challenging, and why you shouldn’t block it.”
Facebook told Fox News that it was contacted by the Center for Investigative Reporting last year and voluntarily unsealed documents related to a 2012 case about the company's refund policies for in-app purchases that parents believe were made in error by their minor children.
"We have now released additional documents as instructed by the court," a Facebook spokesperson said, in a statement emailed to Fox News. "Facebook works with parents and experts to offer tools for families navigating Facebook and the web. As part of that work, we routinely examine our own practices, and in 2016 agreed to update our terms and provide dedicated resources for refund requests related to purchases made by minors on Facebook.”
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Facebook and its leadership are coming under intense scrutiny at the moment amid ongoing concern about the tech giant’s handling of user data.
The Associated Press contributed to this article.
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