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Be careful with kids' privacy - FTC hits developer with hefty penalty

Be careful with kids' privacy - FTC hits developer with hefty penalty

September 17, 2014 | By Kris Graft

Mobile game developer TinyCo is settling with the U.S.’ Federal Trade Commission after regulators accused the company of improperly collecting children’s personal information - a violation of the Children’s Online Privacy Protection Act.

TinyCo, whose games include Tiny Pets, Tiny Zoo, and Tiny Chef, said it would pay the FTC a $300,000 civil penalty [PDF].

The charges and settlement are noteworthy, as child privacy issues become an increasing concern when it comes to mobile apps and games. Game developers must be aware of how their games collect information, and what information they collect, or they could be slapped with fines.

Jessica Rich, director of the FTC’s Bureau of Consumer Protection, said, “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.”

The FTC said TinyCo violated COPPA because its games were aimed at children under 13, and at the same time collected information such as email addresses in exchange for in-game currency. [PDF]

TinyCo, whose apps have been downloaded over 34 million times on mobile app stores, is also required to delete any information it collected from children under 13, as well as comply with COPPA in the future and submit a compliance report to the FTC in one year.

Earlier this month, the FTC hit Google with an order to pay $19 million for deceptive in-app payment systems in free-play-games, while in January, Apple settled its similar FTC complaint by offering up $32.5 million worth of refunds.

The FTC’s announcement about TinyCo today also stated that popular discovery app Yelp was separately fined for violating COPPA, leading to a $450,000 civil penalty.

Update: TinyCo has released a statement clarifying the settlement and outlining its plans to comply with COPPA guidelines moving forward. You can read it over on the TinyCo website, though we've taken the liberty of reprinting a small excerpt below:
"Today TinyCo settled with the FTC over COPPA violations in some of our older games. We have worked with the FTC to correct these issues, and have removed all email addresses collected by our old in-game social identity system, some of which may have belonged to children under the age of 13.

TinyCo fully supports COPPA and the FTC’s effort to protect the privacy and data of children online. We apologize to anyone affected by this issue, and want to be unequivocal in stating that TinyCo is fully committed to protecting user privacy, particularly when children are involved."

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