Update: Yelp settles FTC charges of violating child privacy

The company's in-app registration did not have a functional age-screen, agency said

Yelp has agreed to pay $450,000 to the U.S. Federal Trade Commission to settle charges that the company accepted registrations to its services from children under 13 through its apps.

The FTC had earlier on Tuesday brought a complaint against the service that connects people with local businesses, stating that it had violated a number of rules, including the Children's Online Privacy Protection Act.

Before 2009, users could only register through the website, where Yelp had a screening mechanism to prohibit users under the age of 13 from registering. However, in 2009, Yelp introduced a registration feature in its app, allowing users to register for new accounts through the application but failed to implement a working age-screen mechanism in the feature, according to the FTC complaint in the U.S. District Court for the Northern District of California.

As a result, both the iOS and Android versions of the app accepted registrations and collected information from users who entered dates of birth indicating that they were underaged, the complaint added. This went on until April 2013.

Yelp said in a blog post Tuesday that it had reached a settlement with the FTC regarding the bug in the mobile registration process that failed to disallow registrations from individuals under 13. Birth dates on Yelp are optional in the first place, so users are always free to register without one, it noted.

The FTC charged Yelp with violating the COPPA Rule by failing to provide notice to parents of its information practices, and to obtain verifiable parental consent before collecting, using, or disclosing personal information from children.

Under the proposed settlement, Yelp has to destroy the personal information of children under 13 who registered with the service within 30 days of the entry of the order, in most cases.

Yelp said that only about 0.02% of users who actually completed the registration process during the time period provided an underage birth date, "and we have good reason to believe that many of them were actually adults."

The company had an average of about 138 million monthly unique visitors in the second quarter of this year.

The Yelp case shows that even large companies are rushing to make mobile apps without building in appropriate safeguards for children required by COPPA, said Hudson Kingston, legal director of the Center for Digital Democracy, a consumer protection and privacy organization via email.

Yelp got away with a light fine, although the law calls for $16,000 per violation, but it is good to see that Yelp has gone to the point of deleting all of the affected accounts, Kingston added.

Mobile app developer TinyCo in San Francisco also settled with the FTC and agreed to pay $300,000 following charges that it was offering apps online targeted at kids and in some cases collected information from children under 13 without parental consent, the FTC said Wednesday. TinyCo is also required to delete the information it collected. The developer could not be immediately reached for comment.

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