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FTC Accepts Settlements with Companies that Exposed Consumers' Sensitive Personal Information

October 31, 2012

The United States Federal Trade Commission (FTC (News - Alert)) has accepted final settlements with two operations that were charged with illegally exposing sensitive personal information of thousands of consumers.

Utah-based debt collector EPN, Inc. and Georgia auto dealer Franklin Budget Car Sales, Inc. were charged for letting peer-to-peer file-sharing software to be installed on consumers’ corporate computer systems which led to the security breach.

The settlements made by the FTC with EPN and Franklin will bar misrepresentations about the privacy, security, confidentiality and integrity of any personal information collected from consumers. Also, both of the companies were stipulated to establish and maintain comprehensive information security programs.

Peter Bernstein of TMCnet reported recently about the action taken by the U.S. Federal Trade Commission on a tracking software company that deceived consumers and failed to safeguard sensitive data that it collected.

The firm is Boston-based Compete, a supplier of business intelligence based on the collection of personal information with its Web tracking data. It failed to notify customers about how their data would be used and also failed to honor promises it made to protect the data that it collected.

Compete uses tracking software to collect data on the browsing behavior of millions of consumers, then uses the data to generate reports, which it sells to clients who want to improve their website traffic and sales.

The proposed settlement with FTC entails Compete to get consumers’ consent before collecting any data from the Compete software downloaded onto consumers’ computers. Compete has to delete or anonymize the use of the consumer data it has already collected, and also provide directions to consumers for uninstalling its software.

The Federal Trade Commission strives to protect the interests of consumers by preventing fraudulent, deceptive and unfair business practices. FTC also provides relevant information to consumers so that they can spot, stop and avoid being cheated.

“Education is the first line of defense against fraud and deception; it can help you make well-informed decisions before you spend your money,” stated FTC officials.

Edited by Rachel Ramsey

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