New York State Attorney General Barabara D. Underwood has charged Oath, the umbrella company of AOL and Yahoo!, with a record-breaking penalty of $5 million for violating the Children’s Online Privacy Protection Act (COPPA) of 1998.
AOL’s ad exchange business broke the law by helping to place ads deliberately targeting children on hundreds of websites throughout the period October 2015 to February 2017. It did this by using personal data belonging to under-13s, including cookies and geolocation information.
These actions went against the United States federal law COPPA that requires companies to obtain verifiable parental consent prior to any collection, use, or disclosure of personal information from children under the age of 13.
“COPPA is meant to protect young children from being tracked and targeted by advertisers online,” said Underwood after issuing the charges.
“AOL flagrantly violated the law — and children’s privacy — and will now pay the largest-ever penalty under COPPA.”
The violations took place despite a company policy that prohibits the auction of space on children’s sites, according to settlement documents.
AOL also purchased advertising space on websites from other ad exchanges that were said to be covered by COPPA. It went against the act and allowed the use of targeted ads within the spaces anyway.
Oath has since implemented a technology that aims to adjust practices accordingly when it recognizes a space deemed to be covered by COPPA.
It has also agreed as part of the settlement to create a COPPA compliance program led by a dedicated officer or executive that will provide yearly training to all employees who work with ads on children’s sites.
Finally, the media giant will permanently erase all personal information it collected from children under the age of 13 during that period.
In response to the charges, a spokesperson for Oath said: “We are pleased to see this matter resolved and remain wholly committed to protecting children’s privacy online.”
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