Within days of launching its YouTube Kids site and adding more age categories to the Kids app, YouTube is settling with the Federal Trade Commission over child privacy violations.

According to a report from Politico, YouTube agreed to pay $150-200 million to the Justice Department to settle the FTC investigation. Several advocacy groups submitted a complaint to the FTC asking it to investigate whether the site had violated the Children’s Online Privacy Protection Act (COPPA). Its alleged infraction was collecting data on youthful users to serve them targeted advertisements without the consent of their parents.

The COPPA is intended to ensure no one can exploit children online without their parents knowing what’s going on. The text of the rule, which you can read here, also specifies a site must provide “a reasonable means for a parent to review the personal information collected from a child and to refuse to permit its further use or maintenance” as well as secure the information.

According to Bloomberg, at the same time this investigation was going on, YouTube was making moves to stop advertising targeting children. This would also explain why it’s moving YouTube Kids to its own site, as partitioning child-friendly videos off the main site will make it easier to avoid accidentally advertising on them.

Of course, critics argue that $200 million is comparatively cheap when compared with the size of Google’s coffers. Jeff Chester, executive director for the Center for Digital Democracy, told Politico, “The punishment should’ve been at least half a billion dollars. It’s scandalous. It sends the signal that you in fact can break a privacy law and get away largely scot-free.”

Senator Edward Markey of Massachusetts, who wrote COPPA, said the money isn’t the incentive so much as ensuring companies don’t get the jump on gathering data on children before they’re old enough to consent. In a statement this June, Senator Markey said,

Companies of all types have strong business incentives to gather and monetize information about children,. Personal information about a child can be leveraged to hook consumers for years to come, so it is incumbent upon the FTC to enforce federal law and act as a check against the ever increasing appetite for children’s data.

YouTube Kids launched on the web today.

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