Doug / 05-24-2011 / Consumer Safety

Disney to Pay $3-million Settlement Over Children’s Online Privacy

According to The Los Angeles Times, Disney has agreed to settle a charge by the FTC that alleged several Disney’s Playdom operated sites illegally collected and disclosed personal information from thousands of children. Walt Disney Co. has agreed to pay $3 million to settle the charge that the online worlds operated by its Playdom games division violated the Children’s Online Privacy Protection Act of children younger than 13 on the Internet.

The FTC charged that several sites, including Pony Stars, illegally collected and disclosed personal details of children. Some 821,000 registered with Pony Stars from 2006 to 2010, according to the FTC. An additional 403,000 children provided their information to other websites operated by Playdom.

The FTC’s complaint alleged that Playdom’s sites collected children’s ages and email addresses during registration and allowed children to publicly post personal information, including their real names. The Federal Trade Commission also said the websites failed to obtain parents’ consent before collecting or disclosing children’s information.

Playdom was originally created by Acclaim Games and then purchased by Disney for $563 million in August. Most of the virtual worlds, including Pony Stars were shut down by Acclaim but then reopened by a French company, Feerik Ltd, who took over operations for the websites.

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