‘Facebook stimulated children’s game spending without parental consent’

According to documents, Facebook advised game developers not to take action against spending that children make on the platform without parental permission. Attempts to curb this practice would have a negative impact on sales.

Facebook internally used the term friendly fraud to refer to the practice of children spending money on games without their parents’ consent. In an internal memo about the social network’s policy on friendly fraud, the company indicates that game developers should not block it. In case of complaints, the developers should offer free virtual items. Since these cost nothing, developers should not worry about losses due to refunds. Facebook also considered developing a system to automatically challenge refund requests before reviewing them.

The practices are being exposed by RevealNews, which relies on documents dating from 2010 through 2014. The documents were released as part of a class-action lawsuit regarding children’s spending on games like Angry Birds, PetVille and Ninja Saga. .

The documents show that Facebook knew that many children were spending money without their parents’ permission and that many children were not even aware that they were spending money in their games. The company also knew that many parents were unaware that their credit card was linked to their account and that spending could be made without further verification. The costs for some families ran into thousands of dollars, after which the parents had to go to great lengths to get their money back.

In response to many requests for refunds, Facebook tested an additional step that required children to enter six digits of the credit card before making a spending. The test was successful, but did not lead to implementation due to the impact on sales. The strategy for dealing with refund requests was ‘maximizing turnover’, the documents indicate.