FTC fine on app developer prompts calls for updated privacy policies

Several members of Congress praised the Federal Trade Commission on Monday for settling charges with a mobile app developer accused of invading the privacy of tens of thousands of children, but the lawmakers say more needs to be done to protect kids online.

The FTC accused Broken Thumbs Apps, owned by W3 Innovations, of collecting personal information from children who submitted comments and blog posts to the online character "Emily."

Under the Children's Online Privacy Protection Act and FTC rules, companies are restricted from collecting information from minors.

"The FTC's COPPA Rule requires parental notice and consent before collecting children's personal information online, whether through a website or a mobile app," FTC Chairman Jon Leibowitz said in a statement on Monday. "Companies must give parents the opportunity to make smart choices when it comes to their children's sharing of information on smart phones."

Senate Commerce Chairman Jay Rockefeller, D-W.Va., said the action sets a much-needed precedent for mobile privacy. Still, said Rockefeller, the FTC has more to do to ensure that mobile privacy policies catch up to policies for older technologies.

"We must be particularly vigilant when it comes to protecting the privacy and safety of our children," said Rockefeller, who has held several committee hearings on privacy, in a statement. "And while I am pleased with the FTC's recent action, I also believe it is crucial that the FTC completes its revision of the COPPA Rule to account for changing technology and give consumers the regulatory protections they need for the future."

Rep. Ed Markey, D-Mass., also praised the FTC's decision, and said he will move forward with the Do Not Track Kids Act, introduced earlier this year by Markey and Rep. Joe Barton, R-Texas.

"Since COPPA was signed into law in 1998, children increasingly connect to the Internet on the go, using an array of mobile apps and new services that did not exist when the law was enacted," Markey said in a statement.

The FTC voted 5-0 to levy a $50,000 fine on W3 Innovations for collecting e-mail addresses and other information.

W3 Innovations' apps for iPhones and iPads were downloaded more than 50,000 times. Several of those apps, according to the FTC, were directed at children and were listed in the kids section of Apple's App Store.