Google agreed to a record-setting $170 million settlement with federal and state regulators over allegations YouTube, its subsidiary, illegally gathered children’s personal information.
The Federal Trade Commission announced Wednesday that under the terms of the agreement, Google will pay $136 million to the commission and $34 million to New York state for alleged violations of the Children’s Online Privacy Protection Act, a children’s privacy law. In addition to knowingly and illegally harvesting the information from kids without receiving parental consent, regulators said YouTube made millions of dollars by using the data collected from children to deliver targeted ads to them.
The $136 million penalty is the largest civil fine obtained by the FTC in a case involving the 1998 privacy law.
“YouTube touted its popularity with children to prospective corporate clients,” FTC Chairman Joe Simons said in a statement. “Yet when it came to complying with COPPA, the company refused to acknowledge that portions of its platform were clearly directed to kids. There’s no excuse for YouTube’s violations of the law.”
The proposed settlement, filed in federal court in the District of Columbia, also requires Google and YouTube to implement a system that allows YouTube channel owners to identify content directed toward children to ensure the platform is complying with federal law. Google and YouTube are also required to notify channel owners that content aimed at children may be subject to the measure and the companies must provide annual training for employees who work with YouTube’s channel owners.
Under the settlement, approved by the FTC in a 3-2 party-line vote, YouTube is required to obtain parental consent before collecting personal information from children.
Simons and Commissioner Christine Wilson said in a joint statement the fine and settlement send a “strong message” to platforms and content providers that they need to comply with federal law. But Democrats on the panel warned that while the penalty is record-setting, it could do little to deter content creators who believe the monetary incentives for harvesting children’s data outweigh the risks of being caught for violating the law.
“This order will make YouTube safer for children than it has been, but, without a backstop to catch inappropriately designated content, it will not make YouTube safe enough,” Commissioner Rebecca Kelly Slaughter said. “More action is needed.”
The $170 million penalty and settlement with Google comes as federal regulators have ramped up enforcement of big tech companies for privacy violations. In July, the FTC, which oversees enforcement of federal privacy rules, reached a settlement with Facebook over the social media giant’s mishandling of user data. Facebook agreed to pay a $5 billion fine as a result of the privacy missteps, though the agreement and the monetary penalty were met with criticisms they did not go far enough.
