VTech faces US$650000 fine over broken data laws

  • VTech faces US$650000 fine over broken data laws

VTech faces US$650000 fine over broken data laws

In recent years, a number of toy makers have come under fire for developing children's smart devices that turn out to be privacy nightmares, and a company called VTech Electronics has just settled the US Federal Trade Commission's first case involving an internet-connected toy.

The FTC alleged in a complaint filed by the Justice Department that the Kid Connect application sold with some of VTech's electronic toys collected personal information of hundreds of thousands of children without parental consent.

VTech gathered data on nearly 650,000 children through its Kid Connect app that was placed in numerous electronic toys it makes.

An FTC complaint filed in IL federal court said the company collected personal information from parents on its Learning Lodge Navigator online platform, where VTech's Kid Connect app was available for downloads. "Unfortunately, VTech fell short in both of these areas". Facebook recently announced a messenger service for children as young as 6 and Google introduced YouTube Kids in 2015. It also claims that the company didn't have a proper "prevention or detection system" set up to notify the company when there was a security breach.

Kid Connect enables children to communicate with other youngsters who also have the app, or with adults who download the adult version of the app, the complaint charged.

Subsequently, personal data of was exposed, including photos of millions of children, chat logs, passwords, email addresses, IP addresses and download histories. The company did not, for example, encrypt information transmitted through some of its online services, the F.T.C. said in its complaint.

As of November 2015, approximately 485,000 USA consumers had created Kid Connect accounts for almost 638,000 children, the complaint alleged.

VTech allegedly collected data about children through the defunct platform Planet VTech and also through apps like Kid Connect.

The FTC collaborated with the Office of the Privacy Commissioner of Canada, which is releasing its own Report of Findings. SAFE WEB Act, which allows the FTC to share information with foreign counterparts to combat deceptive and unfair practices that cross national borders. The complaint and stipulated final order was filed in the U.S. District Court for the Northern District of IL. Stipulated final orders have the force of law when approved and signed by the District Court judge.