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Millions of Dollars Spent Inside Apps to be Refunded



Buffalo, NY (WBEN/AP) - Parents hit with hundreds of dollars in unexpected charges when their children bought virtual pet food, gems or other items while playing games on mobile devices will be getting refunds from Apple.
   
The Federal Trade Commission says Apple has agreed to refund at least $32.5 million to unsuspecting parents.
   
The charges are racked up when kids buy imaginary items -- like make-believe currency, or food for their make-believe dragon -- using real money. Some parents have seen charges in the thousands of dollars.
  
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One WNY Parent's Cautionary  Tale
 
One parent told the FTC that her daughter had spent $2,600 in an app called "Tap Pet Hotel." It's a game in which kids can build their own make-believe pet hotel. The game is free to download and play -- but when kids are given the chance to buy make-believe treats for their make-believe pets, they're spending their parents' real money.

 Under the settlement, Apple is going to have to make it more obvious that an actual purchase, with actual money, is taking place.

However, the problem is not just Apple's. CBS Tech Analyst Larry Magid says that Android users are even more susceptible. "Android is now more popular than Apple, at least for smartphones, and they don't even have passwords. You can download an android app without even having to type in a password. I think this is just the beginning of what's going to be a really hard look in to this whole issue of children and apps."

Dollars spent in apps do not necessarily end up in Apple's pocket. Most of the money goes to the app developer, and it is not yet clear how they will have to change the "Freemium" app model.

Tens of thousands of consumers complained.
   
Apple CEO Tim Cook said the company relented because the "consent decree" Apple agreed to does not, in his words, require the company to do anything it wasn't already going to do, so it decided to accept the agreement rather than take on a long and distracting legal fight.

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Topics : Human InterestTechnology_Internet
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Locations : Buffalo
People : Larry MagidTim Cook
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