Mobile social network Path has settled an FTC inquiry into privacy issues. The networks was taken under investigation last year when it uploaded user address book in their entirety to its servers.
Immediately after the downloads were recognized the social network issued an apology and deleted the data.
The formal settlement includes an $800,000 fee for “allegedly collecting kids personal information without receiving parental consent.”
The FTC claims Path’s data collection directly violated the Children’s Online Privacy Protection Act in gathering personal information from around 3,000 kids who were under the age of 13.
Path has also agreed to a “comprehensive” program that will require third-party audits of its privacy policies and systems.
FTC Chairman Jon Leibowitz thanked Path for taking responsibility for its actions:
“Over the years the FTC has been vigilant in responding to a long list of threats to consumer privacy, whether it’s mortgage applications thrown into open trash dumpsters, kids information culled by music fan websites, or unencrypted credit card information left vulnerable to hackers. This settlement with Path shows that no matter what new technologies emerge, the agency will continue to safeguard the privacy of Americans.”
$800,000 is a large sum of money for Path, the company has raised $40 million in venture capital and does not yet have a significant revenue model.