On September 15, 2010, New York State Attorney General Andrew Cuomo announced a $100,000 settlement with EchoMetrix, a developer of parental control software that monitors children’s online activity.  The settlement comes one year after the Electronic Privacy Information Center (“EPIC”) alleged in a complaint to the Federal Trade Commission that EcoMetrix was deceptively collecting and marketing children’s information.

EPIC’s 2009 complaint asserted that EchoMetrix engaged in unfair and deceptive trade practices and violated the Children’s Online Privacy Protection Act (“COPPA”) when it launched Pulse, a data-mining service which gathers marketing intelligence by examining the content of children’s instant messages, blog posts and activity on social networking sites.  The complaint alleged that EchoMetrix was surreptitiously collecting personal information from children and simultaneously disclosing this information to third parties for marketing purposes.  The complaint further alleged that the site’s privacy policy was unclear, inaccessible and did not fully or clearly disclose how information was being collected or shared.  EPIC claimed that EchoMetrix violated COPPA by collecting children’s IM chat names, which are linked to unique email addresses, without providing adequate notice or obtaining verifiable parental consent.

Under the settlement, EchoMetrix has agreed to stop analyzing or sharing with third parties any private communications, information, or online activity to which it has access.  EchoMetrix also will pay the State of New York a $100,000 penalty.