Apple to refund $32.5m to those whose kids bought in-app purchases

Every so often we hear another story of a parent whose kid racked up an unreasonably high bill on their mobile. Like that one kid who bought £1700 worth of bonuses in Pirates vs Ninjas. Of course not all stories of this nature are quite that dramatic. It's usually a few quid there and another there, but it's cumulatively added up to upwards of $32.5m (£19.9m) in reported cases and Apple's going to have to pay it all back following a settlement with the US Federal Trade Commission (FTC).

As reported by the BBC, the FTC noted that Apple had received at "least tens of thousands of complaints" about unauthorised in-app purchases by children.

The ordeal has encouraged Apple to change how in-app purchases are made. Starting shortly, it will require a password to be typed in every time a purchase is made. Currently, when a parent enters their password it unlocks the phone's ability to make purchases password-free for 15 minutes - long enough for some a mischievous little moppet to spend quite a lot of mommy's money.

Additionally, the FTC noted that the password prompt screen failed to mention that this would finalise their purchase.

The FTC said the new restrictions must be in place by 31st March. "This settlement is a victory for consumers harmed by Apple's unfair billing, and a signal to the business community: whether you're doing business in the mobile arena or the mall down the street, fundamental consumer protections apply," said FTC chairwoman Edith Ramirez. "You cannot charge consumers for purchases they did not authorise."

Apple chief executive Tim Cook said the company was planning to refund all these parents' money anyway, regardless of FTC involvement. "The consent decree the FTC proposed does not require us to do anything we weren't already going to do, so we decided to accept it rather that take on a long and distracting legal fight," Cook said in an internal e-mail obtained by 9to5Mac.

He added that the company was already underway on its refunds before the FTC got involved. "We wanted to reach every customer who might have been affected, so we sent emails to 28 million App Store customers - anyone who had made an in-app purchase in a game designed for kids," he explained. "When some emails bounced, we mailed the parents postcards."

"In all, we received 37,000 claims and we will be reimbursing each one as promised."

While Cook is okay with the whole refunding angry parents thing, he felt less favourable towards the FTC's tack concerning the whole affair. "It doesn't feel right for the FTC to sue over a case that had already been settled," he said. "To us, it smacked of double jeopardy."