The first time one of Matt Whitton’s four children managed to bypass the parental controls of the Apple ID on his phone was several years ago, when his son made in-app purchases worth €. ‘about $ 60 without his permission. Whitton disputed the charge with Apple and had the charges quashed.
However, Whitton and his wife, Jen, weren’t ready when their 8-year-old daughter made in-app purchases worth $ 650 while playing the Jewel Heist game on her mother’s phone in early June. of this year. Unfortunately, the password requirement for purchases had been disabled on Jen’s phone, so there was nothing on the phone to stop their daughter.
“She knew she was spending money,” says Whitton, “but had no idea how much it was. She also knew she shouldn’t do it, but she was a little stinky.
Whitton’s story is far from unique. In fact, Apple includes “the purchase of an unauthorized child” as one of the reasons for disputing a purchase on its site. And with more and more kids being bored and homebound while their parents try to work from home, the problem of Junior and Sis making unauthorized in-app purchases is going nowhere.
Here’s what you need to know about kids racking up tabs on your accounts.
Challenge the charge
The first clue that parents have about their child’s frenzy of shopping in their child’s app is often a credit card statement with a larger than expected balance. This is one of the reasons why it can be somewhat difficult to recover lost money. For example, google play requires users to dispute a charge in the app within 48 hours of its completion. You have 120 days to dispute unauthorized charges made by someone you don’t know, but that may not extend to purchases made by your children without your knowledge.
Amazon and Apple do not specify its conditions of eligibility for refunds. Whitton found that Apple’s dispute process was fairly straightforward for his son’s $ 60 purchase several years ago, but not this time around. “After we requested a refund, we had to wait several days to find out that it was not approved,” he says. “And that was it.”
Google, Apple, and Amazon all have easy-to-navigate refund request processes, but that doesn’t necessarily mean you can count on getting your money back when you explain the situation. The tech giants have in the past settled major class actions over the ease with which children can make in-app purchases without their parents’ knowledge or approval, with Google pays $ 19 million, Apple pays $ 32.5 million and Amazon pays $ 70 million in refunds. Despite these lawsuits, the problem hasn’t gone away, and tech companies don’t always feel the need to reimburse these costs.
Escalation of your dispute
If your refund request is denied, then you can escalate your dispute to your credit card or bank. The Whittons’ card registered with Apple was a debit card associated with their US bank checking account. So they called to alert the bank that the $ 650 charge was not authorized.
“At first we were told there was nothing they could do, since no one had stolen our card or our ID,” says Whitton. Fortunately Jen called back and got another customer service agent to approve our dispute. They gave us an additional refund on our account while they investigated, but if Apple refused the dispute again, we would lose the refund.
Parents sometimes find that the unauthorized purchase of their child was not the right type of authorization to get fees waived. the Fair Credit Billing Act (FCBA) protects all credit card holders from unauthorized purchases. By law, you are only liable for a maximum of $ 50 of unauthorized charges.
Unfortunately, the FCBA does not specify whether unauthorized use of a child is considered fraud. It’s hard to tell that your card has been stolen when your kid is the thief. This gray area means that different credit card issuers (and even different customer service agents within the same institution) may make different calls to find out if you are responsible for your child’s purchases.
Although many credit card issuers and banks have systems in place for filing a dispute, you may also need to write a letter to your financial institution detailing the billing dispute. The Federal Trade Commission (FTC) provides a sample protest letter template.
Upon receipt of your dispute letter, your card issuer will temporarily withhold payment of the disputed charge while the creditor investigates. In the case of a bank, as happened to the Whittons, you may receive an additional refund while the institution investigates the dispute. It doesn’t necessarily mean that you are free and clear, however. If the financial institution determines that the charge does not meet their definition of unauthorized purchases, you will still be required to pay.
In the case of the Whittons, after they successfully asked the U.S. bank to investigate the claim, Apple agreed to reimburse $ 420 of the $ 650 in fees. “We thought we had to eat the full amount,” says Whitton, “so getting the two-thirds reimbursement was a big relief.”
Purchases that may not be eligible for a refund
Most parents are likely to see some sort of refund, or even a full refund, by following these steps. However, there is one situation where parents can find themselves unlucky: if their child is an authorized user on their credit card.
Some credit card issuers allow children 16 and under to become Authorized user on their parents ‘card, which means that the child has the legal authority to make purchases on their parents’ account. If you have made your child an Authorized User, you are responsible for all purchases the child makes with the Card, even if you have not approved each individual debit.
File a complaint with the FTC
Parents who are unable to get a satisfactory response from the merchant or their credit card issuer have another lever to pull: Complain to the FTC.
You can file a complaint using the online portal, or you can call 1-877-FTC-HELP. This may seem like a less than satisfactory action, as it won’t necessarily lead to an immediate refund. However, it’s important to remember that the class actions that resulted in refunds from Apple, Google, and Amazon were brought by the FTC over parental complaints.
The importance of prevention
Parents faced with a credit card bill after letting their kids play on a tablet have a tough job ahead of them trying to get their money back. Preventing this kind of situation is much easier and will cause less financial heartburn, not to mention fewer kids stepping on and slamming doors when they get caught.
The simplest prevention (and one most likely to be touted by grandparents who raised kids in the pre-smartphone era) is to always monitor your child’s screen time. If you’re sitting right next to your child when they’re asked to spend real money on a bag of digital jewelry, you’re able to stop them before any damage is done. Of course, this action plan is useless for the majority of parents who give their children screen time to buy precious work time.
Setting up the maximum level of password protection for your financial information is the best way to protect your wallet while allowing your kids to play Virtual Pet Shop without you hanging over their shoulders. Here’s how to make sure you’re completely password protected.
- Delete your saved payment information if possible. Although it is not possible to unlink your payment information from Google Play or the Apple Store (which means it cannot be unlinked from apps purchased from those merchants), you can delete the saved payment information. online shopping sites and other applications.
- Set up accounts for your children. Google, Apple, and Amazon all allow parents to create child accounts that are separate from the parental account. These children’s accounts require parental permission for any purchase. However, this only works for families where children have their own devices.
- Change your password settings. On a Apple device, open Settings, tap iTunes & App Store, tap Password settings, and under Purchases & in-app purchases, click Always require. On a Android device, go to the Google Play Store app, go to Settings, tap Require authentication for purchases, and choose Always require. On a Light up, launch the Amazon Appstore app, tap Account, then Settings, then Parental controls, and then tap Turn on parental controls. This will require a password for any in-app purchase.
- Use a different password for the in-app purchase requirement. If you’re like most people, you’re probably using the same password for several different sites. And your kids probably know your password well, especially if it’s the same one you use to unlock your phone. Make sure the password protecting your credit card from in-app purchases is a password your kids don’t know and can’t understand.
Fake jewelry and actual costs
Parents have always had to deal with costly mistakes their children make. What differentiates buying mistakes in the Gen Z app from baseball mistakes through a window of previous generations is the fact that nothing tangible is happening, which means it is much more difficult for children to understand the real cost of their actions.
Setting up password protections and understanding your rights in case your kids accumulate charges in the app is a great place to start in protecting your finances. But it’s also important that you teach your kids about credit, how money works, and how our choices affect our finances. And that kind of education can happen at any time.
This is how Whitton and his wife deal with the situation with their children: using it as a teachable moment.
“But we’re calling our daughter Six-Fifty right now,” Whitton jokes.