New York - Major record label Sony Music (NYSE: SNE) has agreed to pay $1 million to settle charges brought by the Federal Trade Commission that the company violated online privacy rules when it improperly accepted registrations on websites from children under 13 without parental consent. The FTC alleged in a lawsuit, filed via the U.S. Attorney's Office in Manhattan, that Sony collected personal information from at least 30,000 underage children on 196 of its websites, in violation of the Children's Online Privacy Protection Act (COPPA).

The FTC added that many of the sites allowed children to post photos or videos and engage in private messaging, and that "in this way, children were able to interact with Sony Music fans of all ages, including adults."

"Sites with social networking features, like any Web sites, need to get parental consent before collecting kids' personal information," said FTC chairman William E. Kovacic.

"Sony Music is paying the penalty for falling down on its COPPA obligations."

In addition to the $1 million civic penalty -- the largest ever in a COPPA case -- Sony will delete all personal information collected in violation of the law, satisfy record-keeping and reporting provisions, and provide links on its websites to certain FTC consumer education materials for the next five years.

Related Links:
http://www.ftc.gov/opa/2008/12/sonymusic.shtm

http://snipurl.com/7sm9y (Reuters)