The U.S. Federal Trade Commission (FTC) on Wednesday issued a complaint charging the Indian origin company InMobi of tracking user location against their consent. As a fine, InMobi will pay a sum of $950,000.
According to the complaint issued by the U.S. FTC, InMobi, despite claiming that it has been tracking the locations of users who have given it permission to do so, has been tracking the whereabouts of non-consenting users as well as children.
InMobi works with app developers to push ads to users. When a user gives an app that has tied up with InMobi, permission to track their location, InMobi collects the data and uses the information to push location-specific advertisements to them.
According to the allegations levied by the FTC, InMobi has been tracking non-consenting user locations by collecting basic service set identification addresses (BSSIDs), which act as unique tracking numbers for Wi-Fi access points near where the users are located and used this id to zero-in on their locations.
The FTC alleges that this is in violation of the US FTC Act. It also said that the company collected data from children under the age of 13, as many of the apps InMobi has tied up with were specifically targeted towards this age group. This also violates the U.S. Children's Online Privacy Protection Act (COPPA).
In a statement issued by the FTC, InMobi and the body have reached a settlement, according to which InMobi will pay a sum of $950,000 as penalty. The statement said that the penalty was initially set at $4 million, but was subsequently reduced after taking into account InMobi's financial condition.
According to a report by YourStory, InMobi said that the issue took place due to a technical error.
"During the investigation by FTC, InMobi discovered that there was a technical error at InMobi's end that led to the process not being correctly implemented in all cases. As a result, some COPPA sites were served with interest-based campaigns on the InMobi Network," InMobi said in a statement issued to YS.
The statement also clarified that InMobi has not been fined for inferring user locations through Wi-Fi access points and added that going forward it would ensure that Wi-Fi information will be collected to serve users who have opted for their geo-targeted ads.
As part of the settlement, InMobi will delete all the information it has collected from non-consenting users and children under 13. InMobi will also be required to implement a comprehensive privacy plan that will be audited every two years for the next 20 years.