Ireland has agreed to pay the Romanian Gypsy parents of a blond boy 60,000 euros ($68,000) in compensation after conceding that police employed prejudicial racial profiling when seizing the child.

Irish police in 2013 briefly placed the boy and a blonde-haired girl from another Gypsy family into foster care while investigating the parents for possible child abduction. Both children were returned to their families after DNA tests proved that the fair-haired children were the offspring of their dark-haired Gypsy parents.

Police acted on public tipoffs following a Europe-wide frenzy over unsubstantiated claims that Romanian Gypsies were involved in child trafficking and abduction.

Lawyers representing the government and the suing couple, Iancu and Loredaiva Muntean, announced the settlement Monday in Dublin High Court. Their 4-year-old boy also was present in court.