FTC Settles Record Fine Over Video App’s COPPA Allegations

Owners of musical.ly, a video social networking app now called TikTok, reached a record $5.7 million settlement with the FTC over claims the company illegally collected children’s personal data, the agency announced Wednesday. It’s the largest civil penalty the FTC, whose members unanimously approved, has collected under the Children’s Online Privacy Protection Act. Musical.ly failed to seek parental consent for collecting names, email addresses and other data from users younger than 13, the FTC alleged in a complaint filed by DOJ. “We take enforcement of COPPA very seriously, and we will not tolerate companies that flagrantly ignore the law,” Chairman Joe Simons said in a statement. “These practices reflected the company’s willingness to pursue growth even at the expense of endangering children,” said Commissioners Rohit Chopra and Rebecca Kelly Slaughter. They said executives should face more accountability in future cases. The company has implemented changes that now direct TikTok users into “age-appropriate” app sections, it said: “The new environment for younger users does not permit the sharing of personal information, and it puts extensive limitations on content and user interaction.” Sen. Ed Markey, D-Mass., urged future “higher monetary penalties that will actually [incentivize] COPPA compliance.” More than 200 million worldwide users, 65 million registered in the U.S., downloaded the app. Accounts were publicly available by default, the FTC said, and public reports show adults contacted children through the app. The app includes a feature that lets users discover other users within a 50-mile radius. App operators received thousands of complaints from parents that their underage children had accounts, the FTC said. “This case should put tech companies on notice that continued disregard for COPPA will result in penalties and consumer mistrust that can seriously impact their business,” said Common Sense Media CEO Jim Steyer.