Last updated: February 19. 2013 9:32PM - 176 Views

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WASHINGTON — Software companies that make cellphone apps are being investigated to determine whether they have violated the privacy rights of children by quietly collecting personal information from phones and sharing it with advertisers and data brokers, the Federal Trade Commission said Monday. Such apps can capture a child's physical location, phone numbers of their friends and more.


The FTC described the marketplace for mobile applications — dominated by online stores operated by Apple and Google — as a digital danger zone with inadequate oversight. In a report prepared by the FTC's own experts, it said the industry has grown rapidly but failed to ensure the privacy of young consumers is adequately protected.


Of the 400 apps designed for kids examined by the FTC, most failed to inform parents about the types of data the app could gather and who could access it, the report said. Others apps contained advertising that most parents would find objectionable and included links to Facebook, Twitter and other social media services where kids post information about themselves.


The report said some mobile apps can siphon data to invisible and unknown third parties that could be used to develop a detailed profile of a child without a parent's knowledge or consent.


The FTC also said it was investigating whether any of the software companies that produce apps engaged in unfair or deceptive trade practices, which would be illegal.


In one case, an app that allows children to paint pictures and save them in an online photo gallery didn't indicate that it includes advertising. But investigators said the app ran an ad across the bottom of the screen for an online dating service that said, See 1000+ Singles.


The agency is considering major changes to a 1998 law, Children's Online Privacy Protection Act, that would impose tougher online safeguards for children under 13.


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