Yelp has agreed to pay $450,000 to settle Federal Trade Commission charges that the company collected names and other personal information of children under 13 without the consent of their parents, a clear violation of the Children’s Online Privacy Protection Act.
Yelp had a policy wherein users could only register through its website, which has a screening mechanism to prohibit those under 13 from registering, but that was until 2009, when the company introduced a registration feature in its smartphone apps.
In its complaint, the FTC had said that the business-review company, which had an average of about 138 million monthly unique visitors in Q2 this year, failed to implement a similar screening mechanism in its mobile apps, allowing the iOS and Android versions of the app to accept registrations and collect information from even those who were underaged. This went on until April last year.
Yelp has clarified that the situation stemmed from a “bug” in their mobile registration process. The company also said that only about 0.02% of users who actually completed the registration process during that time period provided an underage birth date, adding that they have "good reason to believe that many of them were actually adults".
The problem has been fixed now and the affected accounts have been closed. The news comes just months after tech giants Google and Apple settled with the FTC over in-app purchases by children.