Announcement and Apology Regarding Some Failure for Spending Limits for Minors

TOKYO, Japan – January 7, 2013 – GREE, Inc. (“GREE”) today announced that there were cases where some underage minors were able to use the social networking service (SNS) GREE beyond the maximum amount set to protect minors, during the period of April 26 and September 7, 2012. These cases were found for minors using the feature phone version of GREE and using credit cards.

We sincerely apologize for the inconvenience this has caused and the delayed disclosure to our customers and all related stakeholders.

Below are the details of the case:

Details of the case

During the period of April 26 and September 7, 2012, when underage customers chose credit cards as a payment method for the feature phone version of GREE, these underage customers were able to use in excess of the maximum amount of JPY 5,000 per month for users ages 15 and below, and the maximum amount of JPY 10,000 per month for users ages 16 to 19. The number of those users was 733 and the total exceeded amount was JPY 28,114,470 *.

Background

During a routine customer usage check, it was discovered on September 6th, 2012 that there were underage customers on the feature phone version of GREE who chose credit cards as the payment method, using more than the maximum amount. Through further investigation, a failure was found.

Reason for occurrence

The maximum amount filter for credit card payment on feature phones was not properly set when the maximum limit was being implemented for minors. In addition, through the verification process, only the payment function was checked without checking the maximum amount.

Response to the occurrence

The failure has been corrected on September 7, 2012, and preventive measures such as strengthening verification tools has been implemented.

In addition, for underage customers who have used in excess of the maximum amount of JPY 5,000 per month for users ages 15 and below, and the maximum amount of JPY 10,000 per month for users ages 16 to 19, using credit cards for the feature phone version GREE during April 26 and September 7, 2012, GREE will announce on its corporate site and in notifications for the GREE service, send individual announcements, and if there are inquiries or requests, GREE will return the amount according to specific procedures.

We will strive for timely disclosure to all of our stakeholders, to prioritize our responsibilities to our customers first and ensure corporate transparency and commit to our social responsibilities.