Google to Refund $19M in In-App Purchases Made by Kids

Google has agreed to refund up to $19 million to customers whose children accidentally racked up in-app purchase charges via their Android devices.

According to the Federal Trade Commission, Google violated a provision in the FTC Act that bans "unfair" commercial practices by billing for in-app purchases that were made by kids without their parents' consent.

"For millions of American families, smartphones and tablets have become a part of their daily lives," FTC Chairwoman Edith Ramirez said in a statement. "As more Americans embrace mobile technology, it's vital to remind companies that time-tested consumer protections still apply, including that consumers should not be charged for purchases they did not authorize."

As part of the FTC settlement, Google must - within 15 days of the deal being finalized - contact customers who made in-app purchases and offer them refunds on those made by kids. If Google ends up refunding less than $19 million, the rest of the money goes into the U.S. Treasury.

The settlement will be open to public comment until Oct. 6, after which point the FTC will decide whether or not to make the deal final.

The FTC's inquiry dates back to 2011 when it decided to look "closely" at the issue of in-app purchases. That resulted in a $32.5 million settlement with Apple in January and a federal complaint against Amazon in July.

Google first added in-app purchases to its app store in 2011 but did not require passwords until 2012. Entering a password, however, opened up a 30-minute purchase window, during which kids could do some serious damage buying energy or other digital trinkets inside their favorite mobile games.

The European Commission is also investigating in-app purchases. In July, it said that Google has committed to removing, by this month, the word "free" from all games that contain in-app purchases, and display price ranges for those in-app purchases. The Web giant will also provide targeted guidelines for developers so they can avoid encouraging children to make micro-transactions, and require a password before every in-app purchase unless the consumer opts out.