FTC Fines Kid Sites For Privacy Violations

Computerworld - Almost a year to the day after a law limiting the ability of Web sites to collect personal data from children took effect, the Federal Trade Commission (FTC) last week levied the first fines against several companies for violating the measure.
The FTC said Monarch Services Inc. and Girls' Life Inc., the Baltimore-based operators of www.girlslife.com, agreed to pay a $30,000 penalty, while Nolan Quan, operator of BigMailBox.com Inc. in Los Angeles, and San Francisco-based LookSmart Ltd. will each pay $35,000. LookSmart's violations involved the Web site www.insidetheweb.com, which currently redirects visitors to a different site owned by the company.
Executives at the companies couldn't be reached for comment by press time last week.
FTC spokeswoman Toby Levin said more civil penalty cases related to violations of the Children's Online Privacy Protection Act (COPPA) are expected to be announced in the next several months.
Parry Aftab, a children's privacy advocate and an attorney at New York-based intellectual property law firm Darby & Darby PC, said the fines serve notice to noncomplying Web sites that the FTC is serious about enforcing the requirements spelled out by COPPA.
"The FTC has been wonderfully patient but maybe too patient," Aftab said. "But now, maybe Web sites which have extra money will put it into [getting into compliance with the law] rather than on design. These sites need to take [the law] seriously."
The action by the FTC comes two days after the Center for Media Education, a nonprofit watchdog group in Washington, released a report calling on the commission to more closely monitor Web site compliance with COPPA and to take appropriate regulatory action against the companies that don't adhere to the law.
According to the FTC, which monitors children's Web sites on an ongoing basis, the three sites that were fined collected personal information from children without getting permission from their parents. The FTC also alleged that none of the three Web sites posted privacy policies as required by COPPA.
In addition to the monetary fines, the FTC said, the sites must delete all the personal information that they collected from children since COPPA became effective on April 21 last year. They also have to post appropriate privacy policies and provide links to an FTC Web site that provides information about COPPA.

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