The Federal Trade Commission has announced proposed settlements with TinyCo and Yelp to conclude enforcement actions alleging violation of the COPPA Rule. TinyCo has agreed to pay a $300,000 civil penalty, and Yelp, to pay a $450,000 civil penalty.
The FTC alleged that TinyCoviolated COPPA when improperly collecting personal information of more than 34 million children from its Tiny Pets, Tiny Zoo, Tiny Monsters, Tiny Village and Mermaid Resort mobile apps. The FTC alleged that because of their themes appealing to children, the brightly colored characters and simple language, these apps were clearly directed to children, therefore TinyCo was required to comply with the terms of the COPPA Regulation.
Under the settlement agreement between TinyCo and the FTC, TinyCo will pay a $300,000 civil penalty. It must also delete information it collected from children under 13, and submit a compliance report to the FTC in one year outlining its COPPA compliance program.
Yelp’s situation is slightly different. The Yelp app registration process required individuals to provide their date of birth. Several thousand registrants provided a date of birth showing they were under 13. According to the FTC complaint, despite knowing that these users were under 13, Yelp failed to follow the requirements of the COPPA Rule. It collected personal information of individuals who had indicated that they were under 13 without proper notice to, and consent from, their parents. Information collected included name, e-mail address, and location, and any other any information that the children posted on Yelp. In addition, the complaint alleges that Yelp did not adequately test its apps to ensure that users under 13 were prohibited from registering.
Under the terms of the proposed settlement agreement, among other things, Yelp must pay a $450,000 civil penalty, must delete information it collected from individuals who stated they were 13 or younger at the time they registered for the service, and submit a compliance report to the FTC in one year outlining its COPPA compliance program.