Nov 092009
 November 9, 2009  Breaches, Business, Featured News also settled with the Texas Attorney General’s Office today:

Texas Attorney General Greg Abbott today resolved an enforcement action against Tagged, Inc., a social networking site operator that has an estimated two million Texas users. Under an agreed final judgment obtained by the state, Tagged must implement new privacy features and take additional measures to inform users about how the Web site will utilize their personal information.

To use Tagged’s social networking service, users must register and create an account. During the enrollment process, state investigators found that the defendant misled subscribers into providing Tagged access to users’ e-mail address books. Tagged then used this access to send deceptive electronic invitations to users’ personal contacts under the user’s name.

Tagged’s deceptive solicitation campaign in early June triggered the state’s investigation. In this venture, Tagged sent e-mails to subscribers’ contacts using the member’s name, and misled those contacts by claiming that subscribers wanted to share their photos. To view those “photos,” which in many instances did not exist, contacts were told they must join Tagged. Tagged enrolled those recipients as users and sought access to their e-mail address books, continuing the deceptive cycle.

Under today’s judgment (pdf), Tagged must clearly disclose its intention to access subscribers’ e-mail address books and send e-mails to users’ contacts. Tagged must secure express, verifiable consent from subscribers for either activity to occur and must allow users to view a sample of the e-mail Tagged will distribute. The judgment also requires Tagged to allow subscribers to select or deselect any individual contacts from their e-mail address book who will receive the corporation’s electronic communication. Tagged also must provide subscribers the option to skip unnecessary access to their e-mail address books.

To better protect subscribers’ personal information, Tagged must designate a corporate level compliance representative and adopt a formal retention policy. The defendant also must allow subscribers to set their accounts to a “private” setting that blocks unauthorized access to their information.

Today’s judgment orders Tagged to pay $145,000 in civil penalties for violations of the Texas Deceptive Trade Practices Act. Tagged also must pay $105,000 to cover the state’s investigative costs.

Source: Attorney General Abbott

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