Chinese short-form video app TikTok, part of ByteDance, on Wednesday was hit with the largest-ever U.S. civil fine for online child privacy violations, agreeing to pay $5.7 million in a settlement with the Federal Trade Commission over allegations it failed to comply with the Children’s Online Privacy Protection Act (COPPA).
For Bytedance, recently valued at $75 billion, the fine is a drop in the bucket. But the settlement puts the tech industry on notice: companies that collect personal information from young children need to toe the COPPA line, or the FTC is likely to bring down the hammer. Facebook, for example, has recently come under fire for a developer program that paid children as young as 13 to monitor their online activity. It also came the day after the FTC set up a taskforce to monitor tech competition, another reminder that the agency is getting more assertive.
The FTC alleged that TikTok didn’t tell parents of children under 13 about the use and collection of their data, ignored parents’ complaints and misled users about their privacy settings. TikTok, which has 65 million U.S. users, said it rolled out a “limited, separate” app with new safety and privacy protections for younger users.