FTC flexes privacy muscle, penalizes ad network

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Washington, D.C.—Even as Congress grapples with legislation that would impose regulations on digital marketers and their use of online customer data, the Federal Trade Commission has taken steps to sanction one online advertising company for deceptive privacy policies.

Chitika Inc., a Westborough, Mass., company that offers search-targeted advertising solutions, was accused by the FTC of surreptitiously installing behavioral-ad tracking cookies on Internet users' browsers 10 days after those users opted out of all tracking. The practice was deceptive and violated federal law, the FTC charged.

Chitika has agreed to offer clear opt-outs that are effective for at least five years, and to destroy all identifiable user information it previously obtained. No financial penalties were imposed.

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