Today the Federal Trade Commission announced that it has settled a case involving the privacy practices of MySpace:
Social networking service Myspace has agreed to settle Federal Trade Commission charges that it misrepresented its protection of users' personal information. The settlement, part of the FTC's ongoing efforts make sure companies live up to the privacy promises they make to consumers, bars Myspace from future privacy misrepresentations, requires it to implement a comprehensive privacy program, and calls for regular, independent privacy assessments for the next 20 years.
via www.ftc.gov
This announcement makes very clear that the FTC continues to vigorously execute its role in policing the promises made by websites to their visitors and holding publishers and site operators liable for broken privacy promises.
While the press release makes no mention of a direct monetary fine, do not for a moment think that the settlement comes without serious cost. The requirement of twenty years of independent auditing is a standard settlement term for the FTC and will be enforced against the company, as well as any successors, future owners, etc. The heightened scrutiny will weigh heavily on the policies and practices -- and the accounting books -- of MySpace for a generation.
Website publishers must take seriously the risks that arise from any discrepancies between their stated privacy practices and the activities that are really occurring on their website. Today's settlement makes clear that the FTC continues to have low tolerance for privacy policy violations and won't hesitate to hold publishers responsible for the promises they make and that the consequences of their failures are real and substantial.
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