Federal Trade Commission Sending $5.6 Million in Refunds to Ring Customers After Security Failure Settlement

The Federal Trade Commission (FTC) has recently declared its intention to distribute over $5.6 million in refunds to customers of Ring, a home security camera company owned by Amazon. This decision stems from a settlement reached in 2023, following a complaint filed by the FTC against Ring. The complaint highlighted Ring's failure to implement adequate security measures to protect customer privacy, which resulted in unauthorized access to user devices and accounts by hackers and even Ring employees.

The FTC's investigation revealed alarming breaches of security, including instances where hackers gained access to customer videos and account profiles, and in some cases, took control of devices to harass and threaten customers, including vulnerable groups such as the elderly and children. Shockingly, the FTC disclosed that hackers exploited security vulnerabilities to infiltrate the videos, video streams, and account profiles of approximately 55,000 Ring customers in the United States.

Moreover, the complaint underscored Ring's negligence in restricting employee access to customer videos, allowing at least one employee to unlawfully surveil female customers in private spaces like bathrooms and bedrooms. Additionally, until 2018, Ring failed to inform customers or seek their consent for utilizing their videos for various purposes, including training artificial intelligence algorithms.

In response to these findings, the FTC condemned Ring's deceptive practices, emphasizing the company's failure to implement essential security measures, unauthorized use of customer videos for training algorithms, and lack of transparency regarding data usage. Consequently, the commission has initiated the process of reimbursing affected customers, with over 117,000 PayPal payments slated for individuals who owned specific Ring devices, such as indoor cameras. These refunds are expected to be claimed within a 30-day window.

This development follows a previous settlement wherein Amazon, the parent company of Ring, agreed to a $25 million payout in response to separate allegations involving the retention of children's voice recordings captured by Alexa smart speakers.