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Cognosphere, the publisher of Genshin Impact, agrees to a $20 million settlement with the FTC over alleged violations of children’s privacy laws.
According to theU.S. Federal Trade Commission (FTC)press release, Genshin Impact developer Cognosphere (known as HoYoverse) “allegedly unfairly marketed loot boxes to children that obscured real costs and misled all players about the odds of obtaining prizes.“The game developer agreed to pay a $20 million fine and “to block children under 16 from making in-game purchases without parental consent”.
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FTC vs HoYoverse
The FTC filed acomplaintalleging “that Singapore-based Cognosphere Pte. Ltd and its California-based subsidiary Cognosphere LLC, which do business in the United States as HoYoverse, actively marketed Genshin Impact to children and collected personal information from them in violation of the Children’s Online Privacy Protection Rule (COPPA)”. Samuel Levine, Director of the FTC’s Bureau of Consumer Protection accused Genshin Impact of deceiving children, teens, and other players into spending “hundreds of dollars on prizes they stood little chance of winning”
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The complaint alleges that the system is challenging and confusing, particularly for children and teens. The FTC also accuses HoYoverse of taking advantage of complicating currencies to force teens to spend money on their “Event Banners”. They add that Genshin Impact uses “anime-style cartoon graphics, bright and colorful animation, and several characters who have the speech or appearance of children to appeal to children”.
COPPA Violations
In addition, HoYoverse is accused of violating the COPPA Rule, which requires online services to inform parents of children under 13 “about the personal information they collect and to obtain verifiable parental consent”. They add: “HoYoverse shared with third-party analytics firms and advertisers user IDs as well as device-related persistent identifiers to track players’ progress, purchases, settings, and friends lists, according to the complaint”.
The company will be required to pay a $20 million fine and make changes to address this situation. This means:
HoYoverse did not make a statement until this article is out. That’s all for now. Stick around for moreGenshin Impactnews and updates onesports.gg.
