Epic Games to Pay $520M+ to the FTC as Settlement Over Fortnite Privacy Case

Ule Lopez
Epic Games FTC

Epic Games landed itself in some hot water with the FTC in regard to the way the game Fortnite violated COPPA rules and regulations. Today, we saw the announcement from the FTC that the case has been settled with two record-breaking settlements that will result in over $500 Million USD in fines. Yes, it's about Fortnite.

According to the FTC, Epic violated the Children's Online Privacy Protection Act by collecting information from children under 13 who played Fortnite without verifiable consent from a parent. In some cases, the company even made parents "jump through hoops" just to have their children's data deleted.

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Because of this, Epic will have to pay a $275 Million settlement for violating the COPPA rule. This fine trumps the one that Google received back in 2019 in which the tech giant had to pay a $170 Million penalty over accusations of harvesting data from children on YouTube. Additionally, Epic must "adopt strong privacy default settings for children and teens, ensuring that voice and text communications are turned off by default."

This particular concern was addressed by Epic Games back in September as high privacy default settings for players under the age of 18 were implemented. These involve features such as Chat defaulting to “Nobody," profile details defaulting to Hidden, parties defaulting to “Invite Only," and personalized recommendations defaulting to Off. Players under 16 also have the mature language filter defaulted On for text chat.

The second chunk of change that Epic will have to pay relates to another part of the FTC's allegations surrounding Fortnite's store and refund systems. See, the FTC alleged that Epic deployed a variety of tactics to drive unintended purchases of virtual currency for acquiring perks such as outfits and dance moves in the game; these tactics ultimately led to millions of dollars in unauthorized charges for consumers.

Now, Epic will have to pay $245 million to refund customers for its billing practices. Consumers who believe they were unfairly charged for in-game purchases can go to a website set up by the FTC to request refunds. The FTC plans to make refunds available even for the following users:

  • Parents whose children made an unauthorized credit card purchase in the Epic Games Store between January 2017 and November 2018
  • Fortnite players who were charged in-game currency (V-Bucks) for unwanted in-game items (such as cosmetics, llamas, or battle passes) between January 2017 and September 2022
  • Fortnite players whose accounts were locked between January 2017 and September 2022 after disputing unauthorized charges with their credit card companies.

However, keep in mind that it will take a while to process the claims. Meanwhile, Epic Games will not admit or deny any of the FTC's allegations with the settlement. According to the company, they accepted this agreement because they want Epic to be at the forefront of consumer protection and to provide the best experience for players.

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