The FTC has just announced that they have reached a settlement with two entertainment app developers for violations of the COPPA (Children’s Online Privacy Protection Act). The combined fines for the two companies is $360,000.
LAI Systems, which is the firm that makes games such as My Cake Shop, My Pizza Shop, Hair Salon Makeover, Friday Night Makeover, Marley the Talking Dog and Animal Sounds will have to pay a total of $60,000 in fines.
Retro Dreamer, which is the firm that developed Ice Cream Jump, Happy Pudding Jump, Ice Cream Drop, Sneezies, Wash the Dishes, Cat Basket and Tappy Pop got fined $300,000.
The violations that these fines were for included allowing third party advertisers that were displayed on their app to collect personal information from children. This was for LAI Systems. The information that was collected was in the form of, ‘persistent identifiers.’
Retro Dreamer got the fine for directly collecting children’s personal information.
Jessica Rich, who is the director of the FTC’s Bureau of Consumer Protection said of these cases, “It’s vital that companies understand the rules of the road when it comes to handling children’s personal information online. These cases make it clear that we’re closely watching this space to ensure children’s privacy online is being protected.”
Whether you develop mobile apps yourself, market them for others or perform other types of online activities where you could potentially collect information from children, these settlements should serve as a warning. The FTC is taking COPPA violations seriously. These two app development companies are mid-level developers so it is clearly not just the ‘big players’ in the digital environment that the FTC is going after.
