Education technology company Edmodo violated a federal privacy law by collecting data from young children for ad purposes, the Federal Trade Commission alleged in a complaint unveiled this week.
The company -- which is now out of business in the U.S. -- allegedly gathered data from around 600,000 U.S. students under the age of 13 in the year 2020, according to the FTC.
The federal Children's Online Privacy Protection Act requires educational companies to receive permission from parents -- or in some circumstances, school officials -- before gathering data from children under 13.
Edmodo allegedly asked schools and teachers to agree to the data collection, but failed to adequately inform them of its privacy practices.
“Defendant failed to make reasonable efforts to ensure the teacher actually received the notice,” the complaint alleges.
The FTC also said that Edmodo should have obtained parents' permission before using any data for commercial purposes.
“Even if defendant had given proper notice to teachers and schools, defendant could not rely on schools or teachers as agents to provide authorization on behalf of parents, because defendant used students’ information to serve contextual advertising, a commercial purpose unrelated to an educational service,” the agency alleged. “Where an operator engages in such non-educational commercial uses, it must obtain consent directly from the parents.”
The company is settling the matter by agreeing to a suspended $6 million fine, and agreeing to destroy data collected without consent of parents or teachers, as well as any algorithms derived from that data. The settlement also prohibits Edmodo from using children's data for advertising or creating profiles.
Watchdogs including the Center for Digital Democracy and Fairplay raised concerns in 2020 about the data collection practices of Edmodo and other education technology companies.
On Tuesday, Fairplay policy counsel Haley Hinkle stated that the FTC's case against Edmodo sends the message that “surveillance advertising has no place in education.”