ControlScan, a company claimed to certify the privacy and security of online retailers and other Web sites, has agreed to pay up to $102,000 to settle Federal Trade Commission charges that it misled consumers about how often it monitored the sites and the steps it took to verify their privacy and security practices, according to the FTC.
This agreement settling the case with Richard Stanton, the founder and former CEO of ControlScan, bars him from misrepresenting the steps that are taken to verify a site’s privacy and security protections. He also is barred from misrepresenting the frequency of verification, according to the FTC.
According to the Commission, ControlScan offered a variety of privacy and security seals for display on Web sites. Consumers could click on the seals to discover exactly what assurances each seal conveyed. However, ControlScan provided these seals to Web sites with “little or no verification” of their security protections. Similarly, the FTC alleges that the company provided its Privacy Protected and Privacy Reviewed seals to Web sites with “little or no verification” of their privacy protections.
Although ControlScan’s seals displayed a current date stamp, the company did not review any of the seal sites on a daily basis. In some instances, Web sites were reviewed only weekly, and in other instances, ControlScan did no ongoing review of a company’s fitness to continue displaying seals—in violation of federal law, the Commission continued.
The settlement also bars the same misrepresentations and requires it to notify the Web sites that have displayed the seals of the Commission action and require them to take down the seals, according to the FTC.
This case is on file in U. S. District Court for the District of Georgia.
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