Yelp, TinyCo Settle with FTC for Collecting Children’s Data

The online review site Yelp and mobile game company TinyCo have both settled separate charges with the Federal Trade Commission that they improperly collected information from children under the age of 13 through their mobile apps. Both settlements were for violations of the Children’s Online Privacy Protection Act (COPPA) of 1998.

Under its agreement with the FTC, Yelp will pay a civil penalty of $450,000 and must delete any information it collected from users who registered and stated they were 13 years old or younger. TinyCo, a San Francisco-based company that makes mobile games like Tiny Zoo Friends and Tiny Castle, will pay a $300,000 civil penalty and is also required to delete information collected from children ages 13 and under.

COPPA, which went into effect in 2000, requires online sites and services to acquire parental consent before collecting any personal information from users under the age of 13. Information covered under the act includes names, e-mail addresses and locations.

Kids’ Increasingly Mobile Lives

“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 Web site,” 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.”

According to the FTC, Yelp between 2009 and 2013 enabled children under 13 to register using its mobile app without the required age screening. The complaint alleged that, while Yelp’s Web site had a functional age-screen mechanism, its mobile registration process did not. Children using the mobile app were able to register even when the birthdates they provided showed they were younger than 13, the FTC found.

The FTC charges against TinyCo alleged that a number of the company’s mobile games were designed to appeal to children under 13. These game apps improperly collected e-mail addresses from underage users in exchange for providing in-game currency for buying items in a game or speeding up play, the FTC said.

Under their settlements, both Yelp and TinyCo will have to submit a compliance report within one year to outline how they are meeting the necessary COPPA requirements.

Millions in Unauthorized Purchases

In a blog post on Yelp’s Web site, Vice President of Corporate Communications Vince Sollitto said the FTC settlement related to “a bug in our mobile registration process.” (continued…)

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