Path Creator Gets Fined By FTC

The Federal Trade Commission has recently made it clear that they are serious about protecting your privacy.  It has just been announced that the creator of the Path social networking app has been fined $800,000 as a part of a settlement.  The FTC has charged that the Path illegally collected personal information from users, including personal information from children without parental consent.

The Path is a social networking service where you can share journals, photos, songs you are listening to, and even your location.  If you were to sign up for the Path, it would give you three options for inviting your friends.  You could either invite friends through your contacts, through Facebook, or through SMS or email invitation.  However, regardless of what option a user chose, and without a user’s explicit consent, Path still collected and stored personal information from your address book, including the first and last names of your friends, addresses, phone numbers, email addresses, user names, and dates of birth. The FTC alleged that  in collecting this data from mobile address books without the knowledge or consent of the user, the Path acted deceptively.

Additionally, the FTC charged that the Path violated the Children’s Online Privacy Protection Act (COPPA).  As the name suggests, COPPA was enacted as a means to protect the privacy of children online.  COPPA prohibits the collection of personal information from kids under 13 without directly notifying parents of collection practices and directly obtaining parental consent to solicit personal information from minors.   The FTC specified that Path collected the personal information, including their precise locations, of approximately 3,000 children under the age of 13.  This was all done without parental consent.

For their part, Path released a statement on their website, downplaying the settlement, and stating that they had closed a “very small number” of accounts that were affected by COPPA.  They also seemed to indicate by their statement that any wrongdoing was due to a glitch in their system, which did not automatically reject users when it was indicated that a user was under 13.  Interestingly, the FTC announcement regarding the settlement was announced on the same day that they announced new recommendations for mobile privacy practices.  The timing certainly makes it clear that the FTC considers online privacy to be a serious matter.

[Image via theprettyui]