The Federal Trade Commission has announced a settlement concerning children’s privacy and online gaming:
The operators of 20 online virtual worlds have agreed to pay $3 million to settle Federal Trade Commission charges that they violated the Children’s Online Privacy Protection Rule by illegally collecting and disclosing personal information from hundreds of thousands of children under age 13 without their parents’ prior consent. This settlement is the largest civil penalty for a violation of the FTC’s COPPA Rule.
The FTC’s complaint charged that Playdom, Inc., a leading developer of online multi-player games, and company executive Howard Marks operated 20 virtual world websites where users could access online games and other activities, including 2 Moons, 9 Dragons, and My Diva Doll. At least one of these virtual worlds, Pony Stars, was a website specifically directed to children, and the company’s other websites intended for a general audience also attracted a significant number of children. Between 2006 and 2010, approximately 403,000 children registered on the defendants’ general audience sites, and 821,000 more users registered in the Pony Stars children’s site.
In addition to the $3 million civil penalty, the settlement order permanently bars the defendants from violating the COPPA Rule and from misrepresenting their information practices regarding children.