Amazon is Liable for $70 Million in Refunds Because of Kids
If you missed the instance in which a child spontaneously ordered a bunch of stuff through Alexa a couple of months ago, you might be surprised to hear that kids everywhere seem to have caught on to the purchasing without permission gambit.
So many kids, in fact, that Amazon is now accountable for over $70 million in potential refunds.
Kids are Smarter Than You
Due to these charges occurring with little in the way of verification beforehand, the FTC unanimously determined that Amazon is liable for them.
Interestingly enough, similar cases were made for Google and Apple, which lends some credibility to the notion that iterations of the “one-click checkout” are far from perfect.
Naturally, Amazon probably won’t have to pay the full $70 million, if for no other reason than one must apply to receive a refund and wade through the ensuing process. It stands to reason, then, that instances wherein a 99-cent app was purchased by someone’s kid may not receive a follow-up.
Nature of the Beast
The main problem here is rooted in sloppy execution. Of course someone is going to find a way to exploit non-verified checkouts, and of course there will be some form of fallout.
However, the fact that Amazon didn’t have more stringent verification processes included is the true reason Amazon is guilty here.
It’s also the reason that this likely won’t be the last time Amazon has to shell out for accidental charges.
One thing to keep an eye on as this phenomenon moves forward is how this ruling affects small business owners and retailers who sell on, but are not in the employ of, Amazon.
If Amazon eats the total cost of these refunds and individual sellers aren’t held accountable, great.
As of right now, though, it’s unclear exactly what the distribution of responsibility will be.
Not what you think. If you have a little ragamuffin running amok in your house, you owe it to yourself—and your credit score—to lock down your Alexa unit with a PIN and other built-in safeguards.
Better yet, avoid leading by example: don’t use your Alexa unit in front of your kid, especially when that use entails purchasing unlimited stuff from the big, bad internet.