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After a public comment period, the Federal Trade Commission has approved a final order resolving the Commission’s complaint against TRUSTe, Inc. for deceiving consumers about its privacy seal program.

The settlement was first announced in November 2014. In its complaint, the FTC alleged that TRUSTe failed to conduct promised annual recertifications of companies participating in its privacy seal program more than 1,000 times between 2006 and 2013. The complaint also alleged that TRUSTe misrepresented its status as a non-profit entity.

Under the terms of the order, TRUSTe is prohibited from making misrepresentations about its certification process, its corporate status, or whether an entity participates in its programs. In addition, TRUSTe must not provide other companies or entities with the means to make misrepresentations about these facts, such as through incorrect or inaccurate model language.

The order also requires the company in its role as a COPPA safe harbor to provide detailed information about its COPPA-related activities in its annual filing to the FTC, as well as maintaining comprehensive records about its COPPA safe harbor activities for ten years. Each of these provisions represents an increase in the reporting requirements laid out under the COPPA Rule for safe harbor programs. The company must also pay $200,000 as part of the settlement.

The Commission vote to approve the final order and letters to commenters was 5-0.  

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

Following a public comment period and review of AgeCheq, Inc.’s initial proposed Children’s Online Privacy Protection (COPPA) Rule verifiable parental consent method, the Federal Trade Commission has denied the company’s application. 

In its application, AgeCheq proposed a real-time common consent mechanism, which conducts identity verification in two ways. The first method of verifying parental identity involves a financial transaction. The second method involves the parent printing, signing, and returning a declaration form to AgeCheq. In a letter to AgeCheq, the FTC stated that the company’s proposed mechanism  uses methods that  have already been recognized as a valid means of obtaining verifiable parental consent in the Rule. The FTC’s letter also states that companies are free to develop common consent mechanisms without Commission approval.

AgeCheq recently proposed a different verifiable parental consent method, which is currently open for public comment.

Under the COPPA Rule, online sites and services directed at children under 13, and general audience sites or services that knowingly collect, use, or disclose personal information from children under 13, must obtain permission from a child’s parents before collecting personal information from that child. The rule lays out a number of acceptable methods for gaining parental consent, but also includes a provision allowing interested parties to submit new verifiable parental consent methods to the Commission for approval. Approved methods may be used by any company, not just the particular applicant requesting approval of the method.

The Commission vote to deny AgeCheq’s application and issue the letter was 5-0.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

CORRECTED: The deadline for comment related to this matter is Dec. 29, 2014. The release previously listed an earlier date.

The Federal Trade Commission is seeking public comment on a proposed verifiable parental consent method that AgeCheq, Inc., has submitted for Commission approval under the agency’s Children’s Online Privacy Protection Rule.

Under the rule, online sites and services directed at children under 13, and general audience sites or services that knowingly collect, use, or disclose personal information from children under 13, must obtain permission from a child’s parents before collecting personal information from that child. The rule lays out a number of acceptable methods for gaining parental consent, but also includes a provision allowing interested parties to submit new verifiable parental consent methods to the FTC for approval.

In a Federal Register notice to be published shortly, the FTC is seeking public comment about the proposed AgeCheq verifiable parental consent method.  Specifically, the Commission seeks comments on: whether the proposed method is already covered by the existing methods included in the rule; whether it meets the rule’s requirement that it be reasonably calculated to ensure that the person providing the consent is actually the child’s parent; and whether the program poses a risk to consumers’ information and, if so, whether that risk is outweighed by the benefits of the program. The comment period will last until Dec. 29, 2014.

This is AgeCheq’s second proposed verifiable parental consent method submitted to the Commission. The first is currently under review by the Commission.

NOTE: Publication of this Federal Register notice does not indicate Commission approval of the program. The Commission has 120 days to review proposed verifiable parental consent methods and must set forth its conclusions in writing.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them.  To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357).  The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad.  The FTC’s website provides free information on a variety of consumer topics.  Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

Fans of Tiny Pets, Tiny Zoo, Tiny Village, Tiny Monsters, and Mermaid Resort will be relieved to know that adorable Sully the Dog and arch-nemesis Duke Spendington haven’t been named in their individual capacities. But the developer of those kid-directed apps – San-Francisco-based TinyCo, Inc. – just settled an FTC lawsuit alleging the company violated the Children’s Online Privacy Protection Act (COPPA) Rule.

If you have children under 13, do you know about COPPA — the Children’s Online Privacy Protection Act? Websites and services covered by COPPA must get your consent before they collect personal information from your child, and they must honor your choices about how that information is used.

That’s why Yelp — the online review service — is getting less than five stars from the FTC.

COPPA logo

Online review site Yelp, Inc., and mobile app developer TinyCo, Inc., agreed to settle separate Federal Trade Commission charges that they improperly collected children’s information in violation of the Children’s Online Privacy Protection Act, or COPPA, Rule. Under the terms of the settlements, Yelp will pay a $450,000 civil penalty, while TinyCo will pay a $300,000 civil penalty.

“As people – especially children – move more of their lives onto mobile devices, it’s important that they have the same consumer protections when they’re using an app that they have when they’re on a website,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection. “Companies should take steps as they build and test their apps to make sure that children’s information won’t be collected without a parent’s consent.”

COPPA requires that companies collecting information about children under 13 online follow a number of steps to ensure that children’s information is protected, including clearly disclosing how the information is used directly to parents and seeking verifiable parental consent before collecting any information from a child.

Yelp, Inc.

The FTC’s complaint against Yelp alleges that, from 2009 to 2013, the company collected personal information from children through the Yelp app without first notifying parents and obtaining their consent. When consumers registered for Yelp through the app on their mobile device, according to the complaint, they were asked to provide their date of birth during the registration process.

According to the complaint, several thousand registrants provided a date of birth showing they were under 13 years old, and Yelp collected information from them including, for example, their name, e-mail address, and location, as well as any information that they posted on Yelp.

The FTC’s complaint alleges that Yelp failed to follow the COPPA Rule’s requirements, even though it knew – based on registrants’ birth dates – that children were registering for Yelp through the mobile app. According to the complaint, Yelp failed to implement a functional age-screen in its apps, thereby allowing children under 13 to register for the service, despite having an age-screen mechanism on its website. In addition, the complaint alleges that Yelp did not adequately test its apps to ensure that users under the age of 13 were prohibited from registering.

In addition to the $450,000 civil penalty, under the terms of its settlement with the FTC, Yelp must delete information it collected from consumers who stated they were 13 years of age or younger at the time they registered for the service, except in cases where the company can prove to the FTC that the consumers were actually older than 13.

The settlement will also require the company to comply with COPPA requirements in the future and submit a compliance report to the FTC in one year outlining its COPPA compliance program.

TinyCo, Inc.

The FTC’s complaint against TinyCo alleges that many of the company’s popular apps, which were downloaded more than 34 million times across the major mobile app stores, targeted children. Among the apps named in the complaint are Tiny Pets, Tiny Zoo, Tiny Monsters, Tiny Village and Mermaid Resort. The complaint alleges that the apps, through their use of themes appealing to children, brightly colored animated characters and simple language, were directed at children under 13 and thus, TinyCo was subject to the COPPA Rule.

Many of TinyCo’s apps included an optional feature that collected e-mail addresses from users, including children younger than age 13. In some of the company’s apps, by providing an e-mail address, users obtained extra in-game currency that could be used to buy items within the game or speed up gameplay. The FTC’s complaint alleges that the company failed to follow the steps required under the Rule related to the collection of children’s personal information.

In addition to the $300,000 civil penalty, under the terms of its settlement with the FTC, TinyCo is required to delete the information it collected from children under 13. The settlement will also require the company to comply with COPPA requirements in the future and submit a compliance report to the FTC in one year outlining its compliance with the order.

The Commission vote to authorize the staff to refer the complaints to the Department of Justice, and to approve the proposed stipulated orders, was 5-0. The DOJ filed the complaints and proposed stipulated orders on behalf of the Commission in U.S. District Court for the Northern District of California on Sept. 16, 2014. The proposed stipulated orders are subject to court approval.

NOTE: The Commission authorizes the filing of a complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. Stipulated orders have the force of law when signed by the District Court judge.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

The Federal Trade Commission is seeking public comment on a proposed verifiable parental consent method that AgeCheq, Inc., has submitted for Commission approval under the agency’s Children’s Online Privacy Protection Rule.

Under the rule, online sites and services directed at children must obtain permission from a child’s parents before collecting personal information from that child. The rule lays out a number of acceptable methods for gaining parental consent, but also includes a provision allowing interested parties to submit new verifiable parental consent methods to the Commission for approval.

In a Federal Register notice to be published shortly, the FTC is seeking public comment about the proposed AgeCheq verifiable parental consent method; whether the proposed method is already covered by the existing methods included in the rule and whether it meets the rule’s requirement that it be reasonably calculated to ensure that the person providing the consent is actually the child’s parent. The Commission also seeks comment on whether the program poses a risk to consumers’ information and whether that risk is outweighed by the benefits of the program. The comment period will last until Sept. 30, 2014.

NOTE: Publication of this Federal Register notice does not indicate Commission approval of the program. The Commission has 120 days to review proposed verifiable parental consent methods and must set forth its conclusions in writing.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them.  To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357).  The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad.  The FTC’s website provides free information on a variety of consumer topics.  Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.


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