Epic Games, publisher and developer of Fortnite will pay $520 Million in fines to the FTC for violating the Children’s Online Privacy Protection Act. FTC had claimed that Epic paired teens and children “with strangers,” exposed them to “dangerous and psychologically traumatizing issues,” and did not provide adequate parental control.
“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,” FTC chair Lina Khan said in a statement.
Epic will pay two penalties, including a $245million fine against Fortnite’s refund and in-game store systems and a $275 million penalty to address concerns about child privacy.
The FTC’s claim that Epic made deliberate choices to appeal to children was at the heart of the settlement. It cited “music, celebrity and brand partnerships,” which included deals with Travis Scott and Ariana Grande and a large collection of Fortnite merchandise.
The FTC stated that Epic failed to address COPPA violations despite being targeted at children. Epic’s efforts to address harassment on-platform were called “weak-willed” by the FTC. The company took two years to “finally [introduce] parental control to the game.”
Epic should have made decisions that would protect children and comply with federal regulations. Epic internal reports, which FTC cited, showed that research had shown that voice chat presented “a risk in terms of negative social behavior.”
“All the while, kids have been bullied, threatened, and harassed, including sexually, through Fortnite,” the FTC complaint read. Although the settlement is substantial, even according to FTC standards, it’s nowhere near the $5 Billion fine Meta demanded.
Facebook, previously known as it, was ordered by the court to pay in 2019. It is a significant rape for a company that made $5.5 billion profit between 2018-2019, according to court documents reviewed.
“Of course, to enable parental controls, parents would first need to know they existed,” the FTC complaint noted. Only in 2019, “long after Epic obtained empirical evidence pointing to large numbers of Fortnite players” under the age of 13, did Epic introduce an age verification system.
“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,” Epic said in a statement.