Privacy groups accuse Facebook of deceiving children into spending parents' money

Public interest groups are accusing Facebook of deceiving children as young as 5 into unknowingly spending their parents’ money on in-game purchases on the social network’s platform.

A coalition of child and privacy advocates filed a complaint with the Federal Trade Commission (FTC) Thursday after court documents that were unsealed last month revealed employees were aware that young children were playing games on the Facebook app and that the company was making it harder for their parents to obtain refunds. The documents were first reported by the Center for Investigative Reporting.

“There is no benefit to consumers here — not to the parents being charged without permission, nor to the kids who do not realize the digital 'sword' they click on in a game costs actual money,” the groups wrote in their FTC complaint. “The only benefits accrue to Facebook and the developers who have designed a system to dupe children and take their families’ money.”

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Among the groups filing the complaint are the Campaign for a Commercial-Free Childhood, Common Sense Media and the Electronic Privacy Information Center.

In a statement, a Facebook spokesperson said that the company has implemented safeguards in its purchasing and refund policies.

“We want people to have safe and enjoyable gaming experiences on Facebook, so providing resources to seek refunds for unauthorized purchases made in games is an important part of the platform," the spokesperson said. "We have in place mechanisms to prevent fraud at the time of purchase and we offer people the option to dispute purchases and seek refunds."

Lawmakers have also raised concerns about the revelations in the court documents. Late last month, Sens. Ed MarkeyEdward (Ed) John MarkeyHillicon Valley: Twitter shares more details on political ad rules | Supreme Court takes up Google-Oracle fight | Pentagon chief defends Microsoft cloud contract House, Senate announce agreement on anti-robocall bill Democratic senators introduce bill to block funding for border wall live stream MORE (D-Mass.) and Richard Blumenthal (D-Conn.) wrote to Facebook CEO Mark ZuckerbergMark Elliot ZuckerbergHillicon Valley: Amazon to challenge Pentagon cloud contract in court | State antitrust investigation into Google expands | Intel agencies no longer collecting location data without warrant Civil rights groups demand changes to Facebook's political speech policy Hillicon Valley: Federal inquiry opened into Google health data deal | Facebook reports millions of post takedowns | Microsoft shakes up privacy debate | Disney plus tops 10M sign-ups in first day MORE demanding answers about the allegations.

The documents stem from a class-action lawsuit from families who had tried to claw back the money spent on the in-game purchases. Facebook agreed to settle the case in 2016.

According to the Center for Investigative Reporting, Facebook employees referred to child users as “whales” — a term commonly used in the casino industry to refer to big spenders — and the company rejected internal proposals to curtail the problem of young users unknowingly spending their parents’ money.

The groups on Thursday asked the FTC to investigate the company’s behavior, alleging that it constituted unfair or deceptive business practices and violated children’s privacy laws.

“Facebook’s internal documents indicate a callous disregard for young people and a culture that prioritized profits over people,” the groups wrote in the complaint.