Microsoft to pay $20 million fine to FTC for improper storage of information on children's Xbox accounts

Microsoft has agreed to pay $20 million in compensation to the Federal Trade Commission (FTC) over allegations that it violated the Children's Online Privacy Protection Act (COPPA). According to official information, the company stored children's personal information for longer than the time allowed when they created their accounts.

In addition to compensation, Microsoft has also pledged to make changes as part of a proposed order submitted by the Department of Justice (DOJ) on behalf of the FTC. These changes include notifying parents that a separate account for children provides an additional layer of privacy, requiring parental consent for accounts created for children prior to 2021, developing a system to remove data required for parental consent for children's accounts, and notifying other publishers when children's personal information is disclosed that verifies their child's identity when using the services.

The agreement with the FTC is the latest to be entered into by a video game company in relation to possible violations of COPPA. In December 2022, Fortnite developer Epic Games entered into a $520 million settlement with the FTC, of which $275 million was related to COPPA violations. Earlier in the month, Epic introduced children's accounts for its Fortnite, Rocket League, and Fall Guys games.

Source: The Verge