In a first of its kind legal action, the Federal Trade Commission (“FTC”) today announced that Pasadena-based, Spokeo, Inc., agreed to an $800,000 settlement over charges that the data collecting company improperly compiled and sold people’s personal information for use by potential employers in screening job applicant’s. Without admitting any guilt and as a part of the settlement terms, Spokeo has agreed to change its business practices and not violate consumer protection statutes by better protecting the information they collect and sell to third parties.
In the complaint filed by FTC lawyers, the Commission alleged that Spokeo sold consumer “profiles” that could include an individual’s phone number, address, marital status, approximate age, e-mail address, hobbies, ethnicity, religion, participation on social media sites, photos, and other identifying data. Additionally, the FTC charged Spokeo with violating Section 5 of the Federal Trade Commission Act for making false and misleading statements. The $800,000 settlement represents the first time the FTC has brought an enforcement action against an Internet company over how they compiled and sold data.