Facebook Caught Red Handed While Swiping Money From Children

According to court documents part of a 2012 class-action lawsuit made public by a federal judge at the request of The Center for Investigative Reporting’s Reveal, social network giant Facebook has made a habit of charging kids without their parents’ knowledge while playing games on its platform.

This happened because, unlike other platforms such as Apple’s iOS, Facebook will not require its users to re-authenticate every time they want to purchase in-game goods such as virtual currency.

Although right now only four documents have been partially made available for analysis to Reveal by the court, Facebook has been ordered to also release to the public roughly one hundred more pages of information pertaining to the class action.

Facebook seeing children as “whales”

Notwithstanding the limited information Reveal was able to examine until now, it is quite clear that the parents part of the class action against Facebook, as well as the company’s employees, are dismayed at the social media giant’s choice of continuing to charge children after an initial purchase approved by their parents.

The lead plaintiff in the case was a child who used his mother’s credit card to pay $20 while playing a game on Facebook. The child, referred to as “I.B.” in the case, did not know the social media giant had stored his mom’s payment information. As he continued to play the game, Ninja Saga, Facebook continued to charge his mom’s credit card, racking up several hundred dollars in just a few weeks.

As a previous ruling of U.S. District Court Judge Beth Freeman says, the child “believed these purchases were being made with virtual currency, and that his mother’s credit card was not being charged for these purchases.”

After the child’s mother decided to ask for a money refund seeing that she only approved the first $20 charge, Facebook refused to oblige, and the kid’s family was forced to join other disgruntled parents who went through the same experience in a class action lawsuit.

Furthermore, as detailed in an internal Facebook published by Reveal, “In nearly all cases the parents knew their child was playing Angry Birds, but didn’t think the child would be allowed to buy anything without their password or authorization first.”

The story gets even more jaw-dropping seeing that some employees were comparing children playing games on Facebook’s platform to big casino spenders:

In one of the unsealed documents, two Facebook employees deny a refund request from a child whom they refer to as a “whale” – a term coined by the casino industry to describe profligate spenders. The child had entered a credit card number to play a game, and in about two weeks racked up thousands of dollars in charges, according to an excerpt of messages between two employees at the social media giant.

The only response Facebook had regarding this situation was a dry one-sentence answer stating that “We appreciate the court’s careful review of these materials.”

Not the first time Facebook finds itself in hot water 

This is not the first time Facebook had to deal with accusations of inappropriate business practices when dealing with its young users.

The Campaign for a Commercial-Free Childhood (CCFC) together with seventeen other organizations filed a complaint with the US Federal Trade Commission (FTC) accusing the social media giant of breaking the Children’s Online Privacy Protection Act (COPPA).

The complaint argued that, at the time, Facebook’s Messenger Kids app was illegally collecting children’s info although parental consent was not given as required by COPPA’s provisions.

Moreover, as stated in the FTC complaint (.PDF) the Facebook Messenger Kids’ privacy policy was also designed to be incomplete and as vague as possible and, thus, not in accordance with COPPA’s terms.

On top of the FTC complaint, the CCFC organization also sprang a petition seeking support from parents who want Facebook to close down the Messenger Kids platform altogether.

Furthermore, as described by the CCFC, Facebook’s CEO Mark Zuckerberg was also sent a letter (.PDF) endorsed by over 100 advocates and experts on January 30, 2018, that asked him to put a hold on the Messenger Kids app undermining children’s healthy development.

A 2017 Children and Parents: Media Use and Attitudes Report from Ofcom, UK’s regulator for communications services, which examined children’s media literacy showed that “46% of 11-year-olds, 51% of 12-year-olds and 28% of 10-year-olds now have a social media profile” as reported by BBC.

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