On Monday 9th November 2020, Microsoft Corp said it will pay a settlement of $20 million to the U.S. Federal Trade Commission, FTC, to settle charges involving the violation of children’s privacy.

The FTC alleged that Microsoft collected personal information from children who signed up for its Xbox gaming system without parental notification or consent, which Microsoft illegally retained.

According to the Children’s Online Privacy Protection Act, COPPA, companies are required to notify parents and obtain their consent before collecting data from children under the age of 13.

Aside from paying the fine, Microsoft will be required to enhance privacy protection for younger users of its Xbox system. The FTC has also mandated that COPPA protections be extended to third-party gaming publishers with whom Microsoft shares children’s data.

“Our proposed order makes it easier for parents to protect their children’s privacy on Xbox and limits what information Microsoft can collect and retain about kids,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection.

The federal court must approve the order before it can go into effect.

This settlement highlights the FTC’s focus on enforcing COPPA and the importance of companies following the law when collecting data from children.

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