American based Federal Trade Commission (FCT), has slammed a $20 million fine on Microsoft for illegally collecting personal data from children bellow 13 on its Xbox gaming system without notifying their parents nor asking for their consent.

The FTC maintained that Microsoft didn’t only breach a 2021 law called the Children’s Online Privacy Protection Act, or COPPA, it also held on to these 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,” Samuel Levine, head of the FTC’s Bureau of Consumer Protection said.

“This action should also make it abundantly clear that kids’ avatars, biometric data, and health information are not exempt from COPPA,” Levine added.

In Microsoft’s defence made via a social media post, Xbox vice president, Dave McCarthy, said the company has had a technical problem which was fixed. Unfortunately, instead of deleting the children’s data, the system held on to them.

Meanwhile, Microsoft may not pay this fine until it is approved by a federal court.