Formal Review 93.2019 - HyperBeard, Inc.

Company failed to participate in self-regulation

Two industry self-regulatory units of the Council of Better Business Bureaus today referred the mobile app developer HyperBeard to the Federal Trade Commission (FTC) for failure to participate in a self-regulatory review process looking into data privacy practices related to children and advertising.

The referral follows a joint inquiry by the Online Interest-Based Advertising Accountability Program and the Children’s Advertising Review Unit (CARU) into HyperBeard’s compliance with the Digital Advertising Alliance’s Self-Regulatory Principles and CARU’s Self-Regulatory Guidelines, including CARU’s guidelines for Online Privacy Protection. The programs made repeated attempts to contact HyperBeard to discuss the business practices at issue but were unable to establish a line of communication with the company. Following their final attempt to reach HyperBeard, the programs initiated this joint referral to the FTC.

“It’s unfortunate that the company didn’t participate, especially given our concerns about the possible collection of data from children without parental consent,” said Jon Brescia, Director of Adjudications & Technology for the Accountability Program. 

The Accountability Program and CARU inquired into HyperBeard’s practices with respect to children’s privacy during monitoring of mobile apps for compliance with the DAA Principles and CARU guidelines. During their review, the programs found that third-party companies appeared to be collecting data through HyperBeard’s app, KleptoCats, in a way that seemed to conflict with these industry standards, which include provisions modeled after the Children’s Online Privacy Protection Act of 1998. 

Today’s referral is the result of ongoing joint monitoring of the mobile app marketplace by CARU and the Accountability Program for compliance with their respective codes, work that both outfits have been conducting successfully for several years.

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