Advocates Blast 'Paltry' $170 Million Penalty for Google's Violations of Child Privacy Rules

Consumer advocates expressed frustration Wednesday with the "paltry" $170 million penalty that Google has agreed to pay as part of a settlement with the Federal Trade Commission and New York's state attorney general for the tech giant's alleged violations of federal online privacy rules for children.

"A paltry financial penalty of $170 million--from a company that earned nearly $137 billion in 2018 alone--sends a signal that if you are a politically powerful corporation, you do not have to fear any serious financial consequences when you break the law."
--Jeff Chester, CDD

Under the settlement, Google and its subsidiary YouTube--which regulators said illegally collected data from kids and used it to target them with advertising--will pay $136 million to the FTC and $34 million to New York and make changes by early next year to comply with the Children's Online Privacy Protection Act (COPPA). The deal comes after more than 20 consumer and privacy groups sent a complaint (pdf) to the FTC in April of 2018.

The settlement was approved by the FTC's three Republican commissioners and opposed by the two Democrats, who felt it did not go far enough. Although--according to a statement from the office of New York Attorney General Letitia James--this marks "the largest-ever settlement in a COPPA enforcement matter," some critics charged that the fine "isn't even a slap on the wrist."

"This punishment is grotesquely low. Google exploiting kids privacy for profit and no real repercussion," tweeted Zephyr Teachout, a progressive attorney, professor, and former political candidate.

"YouTube knowingly broke federal law by tracking kids in order to rake in advertising dollars without the requisite notice to and permission from parents. But the FTC let Google off the hook with a drop-in-the-bucket fine. Not a single Google executive or investor will bat an eye," Sen. Ed Markey (D-Mass.), COPPA's author, wrote in a series of tweets. "The FTC should have issued a colossal fine that fits Google's crime and demanded that Google make significant structural changes to their business practices."

In a pair of tweets, the consumer advocacy group Public Citizen declared the fine "an absolute joke" and highlighted both Google's revenue in recent years and the revolving door between the Big Tech firm and the FTC.

"This is a sad, not celebratory day for children's rights," the group's president Robert Weissman said in a statement. "The leading consumer protection agency has just demonstrated that it will not defend children from blatant exploitation even when it is specifically empowered and ordered to do so."

Public Citizen was among the groups that signed on to the FTC complaint about Google and YouTube's COPPA violations, filed by the Campaign for a Commercial-Free Childhood (CCFC) and the Center for Digital Democracy (CDD) through their attorneys at Georgetown Law's Institute for Public Representation.

"We are pleased that our advocacy has compelled the FTC to finally address YouTube's longstanding COPPA violations and that there will be considerably less behavioral advertising targeted to children on the number one kids' site in the world," CCFC executive director Josh Golin said in a statement Wednesday.

"It's extremely disappointing that the FTC isn't requiring more substantive changes or doing more to hold Google accountable for harming children."
--Josh Golin, CCFC

"But it's extremely disappointing that the FTC isn't requiring more substantive changes or doing more to hold Google accountable for harming children through years of illegal data collection," Golin added. "A plethora of parental concerns about YouTube--from inappropriate content and recommendations to excessive screen time--can all be traced to Google's business model of using data to maximize watch time and ad revenue."

CDD executive director Jeff Chester, who helped lead the campaign for COPPA's passage in 1998, concurred.

"We are gratified that the FTC has finally forced Google to confront its longstanding lie that it wasn't targeting children on YouTube," said Chester. "However, we are very disappointed that the commission failed to penalize Google sufficiently for its ongoing violations of COPPA and failed to hold Google executives personally responsible for the roles they played."

"A paltry financial penalty of $170 million--from a company that earned nearly $137 billion in 2018 alone--sends a signal that if you are a politically powerful corporation, you do not have to fear any serious financial consequences when you break the law," he warned. "More fundamental changes will be required to ensure that YouTube is a safe and fair platform for young people."

According to Chester, "the commission's inability to stop Google's cynically calculated defiance of COPPA underscores why Congress must create a new consumer watchdog that will truly protect Americans' privacy."

News of the settlement comes a day after The Washington Postreported that "more than half of the nation's state attorneys general are readying an investigation into Google for potential antitrust violations, scheduled to be announced next week, marking a major escalation in U.S. regulators' efforts to probe Silicon Valley's largest companies."