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Sites still gather children's data

Many sites are ignoring Federal Trade Commission guidelines about the collection of personal data from children, the agency says.

Numerous online children's sites seem to be ignoring guidelines set by the Federal Trade Commission regarding the collection of personal data from young surfers, the agency reported today.

After surveying in October 126 Web sites listed by the children's Net directory Yahooligans, the FTC said today that 86 percent of the sites collected children's names, email and home addresses, and telephone numbers--in most cases without prior parental permission. Only about 35 of the sites posted a privacy policy detailing what they would do with the information.

In July, FTC staff issued a letter stating that Web sites must obtain parental permission before distributing private data about a child to a third party, and must disclose to parents how the data will be used before collecting it. Infringement of the guidelines could be deemed an unfair and deceptive practice, which gives the FTC authority to investigate.

"The FTC can bring legal action to halt such violations and seek an order imposing restrictions on the future practice to ensure compliance with the FTC act," Jodie Bernstein, director of the agency's Bureau of Consumer Protection, said today in a statement.

The results of the survey underscore the complaint of privacy and children's advocates that the FTC's threats aren't enough, and that tougher federal regulations are needed when it comes to shielding young consumers' online privacy.

The guidelines were laid out in a letter the bureau wrote to KidsCom, which it had investigated after it received complaints that the site was gathering minors' names, birth dates, product preferences, and favorite hobbies.

Prior to receiving the letter, KidsCom changed its practices, and now contends that it doesn't sell data to third parties, prominently posts a privacy policy, and doesn't use any data collected for one-to-one marketing at children.

Nonetheless, KidsCom's past techniques were highlighted during the FTC's week-long privacy hearings in June. Children's advocates voiced loudly their opposition to sites such as Crayola, Hasbro's Action Man and Monopoly sites, and Nickelodeon, which allegedly enticed sensitive information from minors using prizes and other methods.

Groups such as the Center for Media Education conducted the study of the well-known sites, and asked the FTC to recommend that Congress enact stiff penalties for sites that collect children's private information.

But the online industry pleaded with the FTC to first give voluntary self-regulatory rules a chance. The industry made promises at the White House-organized Internet Online Summit: Focus On Children in Washington this month.

"This survey 'snapshot' demonstrates that these [self-regulatory] guidelines need to be more broadly implemented," Bernstein said. "FTC staff will be conducting a systematic review of Web sites' information collection practices in March 1998 to report to Congress on the extent to which Web sites, including children's Web sites, are posting privacy policies."