Senators Want FTC To Scrutinize Facebook Over 'Friendly Fraud'

Two Senate Democrats want the Federal Trade Commission to review claims that Facebook duped children into using their parents' credit cards to make purchases in games.

Sens. Ed Markey (D-Massachusetts) and Richard Blumenthal (D-Connecticut) last month asked Facebook CEO Mark Zuckerberg to address allegations that the company allowed developers to trick children into spending their parents' money while playing games like Angry Birds and Barn Buddy.

The lawmakers asked Zuckerberg to answer a host of questions, including when he personally became aware that children “were likely unknowingly spending their parents' money while playing games.”

The lawmakers initially wrote to Facebook in response to a report by The Center for Public Integrity, which said newly unsealed court documents showed that the company encouraged developers to let children make in-app purchases without their parents' permission.



The documents were part of the court record of a lawsuit filed in 2012 by Arizona resident Glynnis Bohannon, who alleged her son ran up hundreds of dollars purchasing Facebook Credits for use in Ninja Saga.

Bohannon and Facebook settled that matter in 2016. Last month, The Center for Public Integrity convinced U.S. District Court Judge Beth Labson Freeman to unseal many documents in the case, including damaging internal Facebook emails and memos.

In one internal email, a Facebook employee referred to a child who racked up $6,000 in charges as a “whale” -- jargon for a big spender.

Facebook's Kevin Martin, vice president for U.S. public policy (and a former Federal Communications Commission chairman), said in a five-page response to the senators that Facebook “never encouraged anyone to engage in friendly fraud” -- the industry term for charges made by a friend or relative without permission. 

Markey and Blumenthal say that response was unsatisfactory. “It is clear that Facebook did not step in when it became aware that developers were encouraging children to make unauthorized credit card purchases, even when those games targeted children,” the lawmakers stated late Thursday. “We did not even receive an explicit answer to our question about when Mark Zuckerberg became aware of Facebook’s friendly fraud problem.”

The senators went on to urge the FTC to review a complaint against the company filed Thursday by advocacy groups.

“It shouldn’t take another settlement for Facebook to meet its ethical obligation to protect kids and families on its platform,” they write. 

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