U.S. slaps record penalty on Fortnite maker for alleged children's privacy violation

"Fortnite" creator Epic Games will pay $520 million to settle allegations that it illegally collected children's personal information and tricked people into making purchases, the Federal Trade Commission and the company said on Monday.

It will pay a record penalty of $275 million for violating a children's privacy law and adopt strong default privacy settings for young people. Epic Games will also pay $245 million to refund consumers duped by so-called "dark patterns" into making purchases they did not intend to make, the FTC said.

"Epic used privacy-invasive default settings and deceptive interfaces that tricked Fortnite users, including teenagers and children," said FTC Chair Lina Khan in a statement.

The announcement comes as the agency has taken a more muscular role in policing the gaming industry, announcing last week a complaint against Microsoft over its $69 billion bid to acquire Activision.