Yelp said Tuesday that it has agreed on a settlement with the Federal Trade Commission regarding the lawsuit the agency filed against the online customer-review site for violating child privacy laws.
According to the lawsuit filed with the northern district court of California, Yelp had violated the Children's Online Privacy Protection Act for collecting children's names and other information without consent.
Yelp countered this; however, saying it was unintentional and that the problem lies in a bug in the company's mobile app. Users could only register for an account through the Yelp website before 2009 but a registration feature was introduced in its mobile app.
This made it possible to register for an account through the mobile app starting 2009 but apparently Yelp had failed to put in age screening in the program. This then resulted in the mobile app gathering of information from accepted registrations even though birth dates entered would make users underage.
Fortunately, out of all accounts made between 2009 and 2013, only 0.02 percent of those were affected by the bug in the registration process. Yelp also believes that majority of affected accounts were actually made by adults.
"When this problem was brought to our attention, we fixed it immediately and closed the affected users' accounts. Yelp doesn't promote itself as a place for children. We're glad to have been able to cooperate with the FTC to get to a quick resolution and look forward to continuing our efforts to protect our users," the company wrote in a blog post announcing the settlement.
Still, Yelp reiterated that registering birth dates is optional. Users will still be able to create accounts even if they don't enter their date of birth.
After paying $450,000 for the settlement, Yelp was also ordered not to disclose any of the personal information it was able to collect. It also needs to file a compliance report within one year detailing means to avoid collecting data from children and how parental consent will be obtained if information on a minor is to be gathered.
Yelp is the most recent example of the FTC's aggressive campaign against violators of the COPPA, which the government recently amended to include app and mobile game developers.
Other companies targeted by the FTC include Apple, Google, and Amazon. Apple had already agreed to a settlement in January amounting to $32.5-million, while Google will be paying at least $19 million. Amazon is still fighting the charges filed by the FTC.
