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Facebook Businesses Social Networks The Almighty Buck The Courts

Lawsuit Reveals How Facebook Profited Off Confused Children: Report (salon.com) 96

Documents outlining how Facebook profited off children are expected to be made public soon, according to Reveal News of the Center for Investigative Reporting (CIR), who requested the documents. From a report: In a report about the trove of previously-sealed documents, Reveal News explains that Facebook has previously faced lawsuits for failing to refund charges made by children playing games on Facebook. According to Reveal, the children did not know that their parent's credit card was stored on the platform when they clicked "buy," and in some cases, hundreds or even thousands of dollars were spent. In one case, the plaintiff, who is a child, spent several hundreds of dollars in just a few weeks. According to the report, more documents show "widespread confusion by children and their parents, who didn't understand Facebook continued to charge them as they played games."
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Lawsuit Reveals How Facebook Profited Off Confused Children: Report

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  • by Anonymous Coward

    ...registers a credit card with facebook? Or a phone, for that matter. It is a trap, and idiots walk into it.

  • by Oswald McWeany ( 2428506 ) on Friday January 18, 2019 @01:58PM (#57982950)

    I'm confused. I've never been a Facebook member, but from what I understood it was a free platform funded by advertising. Why does Facebook have anyone's credit card on file in the first place?

    • To buy advertising on Facebook (as a small business anyway) you pay by card, and you register the card to your personal account, from which you manage your business's page.
    • by SuperKendall ( 25149 ) on Friday January 18, 2019 @02:26PM (#57983154)

      Why does Facebook have anyone's credit card on file in the first place?

      If you read the first part of the article (ahem), it says:

      The child, referred to as âoeI.B.â in the case, did not know the social media giant had stored his momâ(TM)s payment information. As he continued to play the game, Ninja Saga, Facebook continued to charge his momâ(TM)s credit card, racking up several hundred dollars in just a few weeks.

      But unlike iOS or Android, where often kids overcharging without parents knowing about it and they get refunded, Facebook was apparently a lot less lenient about refunds.

      • by PPH ( 736903 )

        The child, referred to as ÃoeI.B.Ã in the case

        I'd sue my parents for giving me a name that won't render properly on Slashdot.

    • I'm confused. I've never been a Facebook member, but from what I understood it was a free platform funded by advertising.

      You are indeed confused. Facebook is also a game and app platform. Non-advertising revenue is falling, and they are heading toward a more "pure" ad model, but they still make about $150M per quarter from games and apps vs about $13B from ads.

  • Fuckerberg is evil (Score:1, Interesting)

    by Anonymous Coward

    Both Facebook and Google live by surreptitiously collecting data on you - data that you wouldn't tell them - and then selling it.

    That's evil.

    • "Both Facebook and Google live by surreptitiously collecting data on you - data that you wouldn't tell them - and then selling it."

      Mod parent UP! To +10. (Okay, 5.)

      When I go to a bank website, often NoScript tells me there are links to Google Analytics, Google Tag Manager, and other Google services.

      I think banks, medical facilities, and government entities should not be allowed to connect to web addresses they don't own.
  • by Echoez ( 562950 ) * on Friday January 18, 2019 @02:00PM (#57982970)
    This has happened on Google Play and the Apple iTunes store. This seems more like a story of the lack of imagination on the part of Google/Apple/Facebook when it came to making purchases on a device where the user is a registered adult. As much as I hate Facebook, this isn't a unique problem to them. My guess is that right now, similar situations happen with the Nintendo Switch store, Xbox, PS4 and others. The real fault lies in a combination of the parents not monitoring or securing their phones, and the original settings that allowed you to save a password for those stores and not require it upon each purchase. Facebook is guilty of many many things, but this seems overhyped.
    • Exactly. Stories have been around about this on the iphone for 6+ years: http://www.abc.net.au/news/2012-09-17/kids-racking-up-huge-bills-on-mobile-games/4266632 [abc.net.au]
    • by Anonymous Coward

      Facebook declined the refunds calling the child "a whale." That pushes the behavior from being an accident to deliberate policy to take financial advantage of mistakes made by children, both a PR nightmare and illegal.

    • by Solandri ( 704621 ) on Friday January 18, 2019 @02:49PM (#57983316)
      It's not the parents' fault. These companies were slow to add the concept of child accounts - accounts which had access to the apps purchased by the main account, but which had fewer privileges (including no purchase privilege). As a result, if you as a parent wanted to buy an app for your child's device, you had two choices. Either buy them on your account, and use your account on your child's device. Or buy them on your child's account (add your credit card info to their account). Both solutions end up with the child's device having access to purchase permission.

      To be fair, the companies added the ability to require a passcode to be punched in before a purchase would go through. But then as you say, they also gave you the option to have the device remember the passcode so you wouldn't have to punch it in all the time.

      Given that children are necessary for the species to survive, the proper solution is to allow child accounts. These are accounts which have access to apps purchased by the parent account, but which have no purchase privileges themselves. I can understand why the companies are reluctant to do it though - it means you can let your friends use the apps you buy by setting them up with a child account. Google added this capability a few years back [google.com] (dunno about Facebook or Apple), but hasn't publicized it well. So many parents continue to use their main account on their children' devices.
      • by epine ( 68316 )

        Uh, what excuses the parents from initially refusing to buy any Facebook apps for their children until Facebook comes to their senses about their unworkable revenue security model?

        Man, I can't wait for the day when there's a consumer JARVIS who goes *cough* *cough* "you know, there's presently no way to purchase an app from Facebook that doesn't allow your children to make in-game purchases on your credit card."

        Parent: "What, they don't even have a password or something."

        JARVIS: "Well, they do, but on past

  • by xack ( 5304745 ) on Friday January 18, 2019 @02:04PM (#57983000)
    No beating around the bush, it is psychological abuse and theft getting childen into trouble.
  • Null AND Void (Score:5, Interesting)

    by sdinfoserv ( 1793266 ) on Friday January 18, 2019 @02:06PM (#57983014)
    I believe from the very beginning, Facebook's business social model was and continues to be mostly illegal. In the US, minors can't sign contracts. Any contract with a minor is considered 'null and void'. Therefore minors can not agree to any ELU (end user license agreement). Thus any data collect by the activity of a minor is illegally obtained.
    • In the US, minors can't sign contracts. Any contract with a minor is considered 'null and void'.

      Tell that to all the people who signed up for student loans at 17.

      • A) You may find that people under age 25 who received a student loan had their parents signature in multiple places, because you have to disclose family income. If not, then they signed other forms claiming to be an orphan or something.

        B) If they're still 17 and were admitted to the school and were given the loan without any parental approval, and they drop all their classes after the cutoff date for the term, they may indeed be able to challenge enforcement of the charges for that term. But obviously any c

      • The parents. https://en.wikipedia.org/wiki/... [wikipedia.org]
      • The parents signed up for the loans, not the children. Again, law in the US does not recognize a contract with someone under the age of majority... usually 18
        https://law.freeadvice.com/gen... [freeadvice.com]
        • law in the US does not recognize a contract with someone under the age of majority... usually 18
          https://law.freeadvice.com/gen [freeadvice.com]...

          I note your citation itself cites nothing, which makes it... worthless. But that's no surprise, because free legal advice is worth every penny spent on it.

    • Re:Null AND Void (Score:4, Interesting)

      by Aighearach ( 97333 ) on Friday January 18, 2019 @02:26PM (#57983160)

      I believe from the very beginning, Facebook's business social model was and continues to be mostly illegal. In the US, minors can't sign contracts. Any contract with a minor is considered 'null and void'. Therefore minors can not agree to any ELU (end user license agreement). Thus any data collect by the activity of a minor is illegally obtained.

      This is "stupidly wrong and wouldn't survive the first page of search results if you bothered to check before making the claim."

      In the US, minors can enter into contracts. By signing them. However, contract terms can't generally be enforced against minors. But they are still financially responsible for any goods or services they receive under the contract.

      The net result is that minors can cancel a contract at any time, regardless of the details of the contract, and they don't owe you anything at all if they return the goods, or if the service wasn't rendered for whatever reason including that their parents didn't let them finish doing it. So it is a really bad idea to engage in contracts with minors.

      And unless you're a lawyer, never move forwards to "thus." Those will always be wrong. Find out what lawyers say about it, choose one of those things, and repeat it. That's the only way to move from "words about the law" to "implications thereof."

      • by carni ( 710219 )
        Thus gatekeeping.
        • Don't forget to include some ideas with your words next time. It shouldn't be that hard, you didn't manage very many words.

      • So it is a really bad idea to engage in contracts with minors.

        That depends on your margins. If you are selling digital goods with a marginal cost of $0, you have nothing at risk, and thus nothing to lose if a refund is demanded.

        • That's a lot of assumptions, though. If they're all true, then yeah.

          What if there are potential liabilities beyond just the cost of providing the service? What then?!?

    • That is not entirely true... it depends on the state. In my state it's 18 unless emancipated then as young as 16 or at 16 you can get a loan with an adult co-signer. Of course you still can't purchase alcohol, tobacco, or firearms until you reach the regular age.

  • by cascadingstylesheet ( 140919 ) on Friday January 18, 2019 @02:12PM (#57983070) Journal

    I'm assuming Facebook must have their own payment system ... surely most FB users don't have a credit card on file with them?

    OK, so for those who do ... why would you let your child play with your FB account then?

    Do you let your children play with your Amazon account? Or your physical wallet?

  • Here's your $2 coupon for a free slurpee. Thank you for playing

  • According to the report, more documents show "widespread confusion by children and their parents, who didn't understand Facebook continued to charge them as they played games."

    Let me say it right away. I loathe Facebook, do not see [any] value in it and do not use it in any way.

    But on the other hand, why should one blame FB for failing to understand it, or its business practices?

    Who let these kids have access to the gadgets they used to access Facebook? Why blame FB for your failure to understand it? I just do not get it!

    • Who the hell would give Facebook their credit card number in the first place??? To say nothing of letting their kids play games using their account...
  • by Locke2005 ( 849178 ) on Friday January 18, 2019 @03:16PM (#57983550)
    I bitched at Microsoft Live for using the credit card number I gave them for Microsoft Live to let my daughter by Overwatch loot boxes without my permission, and they actually refunded my money -- but of course, I shut off my daughter's Microsoft Live after that. Yes, anybody offering in-game purchases should also offer parental controls, or face not getting paid -- children aren't legally able to enter into binding contracts.
    • by impos ( 805511 )

      Kind of idiotic, tying your CC number to a kid's Xbox Live account, when there are these things called 'gift cards' that you should be using instead. Easy to obtain (everywhere sells gift cards now, grocery stores, Walgreens, even Home Depot) or virtual codes that you can buy from Amazon in about 30 seconds. There are also Facebook gift cards, that would accomplish the same thing.

  • Just shut it all down permanently, delete everything, and prevent anything like it from existing ever again, it is CANCEROUS.

Understanding is always the understanding of a smaller problem in relation to a bigger problem. -- P.D. Ouspensky

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