Facebook tricked kids to rake in money from online games, says report
Unsealed documents from a class action lawsuit reportedly raise red flags about Facebook's business practices.
Facebook reportedly duped kids into spending their parents' money in online games.
The social media giant targeted kids in an aggressive effort to pump up revenue from games like Angry Birds, PetVille and Ninja Saga, Reveal reported Thursday, citing court documents from a 2012 class action lawsuit.
Reveal is the website run by the Center for Investigative Reporting (CIR), a nonprofit news organization.
The report is based on the more than 135 pages of unsealed documents that include internal company memos, secret strategies and employee emails, according to Reveal. A federal judge ordered the documents, which are from 2010 to 2014, to be unsealed after a request from the publication.
The cited documents allege that Facebook encouraged "friendly fraud," meaning developers should let kids unknowingly spend money on their games. The social network also allegedly ignored employees' warnings that it was tricking underage users who didn't realize credit cards were linked the Facebook accounts. Some went so far as to develop a fix for the problem, but the company never implemented it, according to Reveal.
One teenager reportedly spent $6,500 over about two weeks of Facebook gaming and the company allegedly denied refunds in cases like this. Employees called such gamers "whales," which Reveal noted is a casino industry term for big spenders.
Facebook acknowledged that, after being contacted by the CIR in 2018, it voluntarily unsealed documents related to a 2012 case about its refund policies "for in-app purchases that parents believe were made in error by their minor children."
"We have now released additional documents as instructed by the court," a company spokesperson wrote in an emailed statement. "Facebook works with parents and experts to offer tools for families navigating Facebook and the web. As part of that work, we routinely examine our own practices, and in 2016 agreed to update our terms and provide dedicated resources for refund requests related to purchases made by minors on Facebook."
First published at 6:47 a.m. PT.
Updated at 8:13 a.m. PT: Adds Facebook statement, more detail on CIR.
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