Home » Microsoft hit with $20 million fine from FTC for illegally collecting children’s data

Microsoft hit with $20 million fine from FTC for illegally collecting children’s data

Xbox Series X Console Microsoft FTC fine

Microsoft and ‘the court’ are two terms that have been featured in the same headlines for quite some months now. In addition to its ongoing battle with its proposed purchase of Activision, the American tech giant is now in hot water with the Federal Trade Commission over charges involving the violation of the Children’s Online Privacy Protection Act.

Microsoft has agreed to pay a $20 million fine to the FTC, as the Xbox maker has admitted to the charges that involve “collecting personal information from children who signed up to its Xbox gaming system without notifying their parents or obtaining their parents’ consent, and by illegally retaining children’s personal information”, as the FTC puts it.

As well as an FTC fine, Microsoft may have to make more changes

With this agreement, also comes changes. According to the FTC’s release on the matter, specifically what was said by the FTC’s own Samuel Levine, it has proposed to Microsoft to alter its systems to allow parents to more easily “protect their children’s privacy on Xbox.” Also, they recommend putting limitations in place for the data that Microsoft “can collect and retain about kids.” Levine went on to say “This action should also make it abundantly clear that kids’ avatars, biometric data and health information are not exempt from COPPA.”

The proposed order by the FTC also includes these changes extending to third-party games, all in an effort to ensure that data obtained by underage players is protected by COPPA, throughout their interactions with an Xbox across any given title or service.

Xbox Series S console Microsoft FTC fine

Although Microsoft has agreed to pay the settlement, all of the proposed changes being ordered by the FTC will only be forced to happen if and when it gets “approved by a federal court,” as the FTC states.

So, how exactly did Microsoft get hit with this complaint in the first place? To summarize, Microsoft’s account creation process for Xbox Live asked for too much information without first notifying user’s under the age of 13 that they needed their parents’ permission to provide those personal details. Because this data was held onto for years, Microsoft was also seen to be in violation for that, too

You can read the full details of the complaint by the FTC over on its official website.

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