Hoyoverse, the publisher of the popular game Genshin Impact, has reached a $20 million settlement with the Federal Trade Commission (FTC). The settlement includes a ban on selling loot boxes to players under 16 without parental consent.
In an FTC press release, the agency stated that Hoyoverse will pay the fine and implement measures to prevent underage in-app purchases. This follows allegations that the company misled players, particularly children and teens, into spending significant sums on in-game items with low odds of winning.
FTC Bureau of Consumer Protection Director Samuel Levine criticized Hoyoverse's "dark pattern tactics," emphasizing that companies employing deceptive practices, especially targeting young players, will face consequences.
The FTC's primary claims against Hoyoverse involve violations of the Children's Online Privacy Protection Rule (COPPA). These violations allegedly include marketing to children and collecting their personal data without proper consent, as well as deceptive practices regarding the odds of winning "five-star" loot box prizes and the overall cost of obtaining them. The FTC argued that the game's virtual currency system was confusing and unfair, leading to substantial unforeseen spending by young players.
In addition to the financial penalty and the sales restriction, the settlement mandates that Hoyoverse publicly disclose loot box odds and virtual currency exchange rates, delete personal information collected from children under 13, and ensure future compliance with COPPA regulations.
