Amazon has reached an agreement with the Federal Trade Commission (FTC) to pay a $5.8 million fine for privacy violations after a former employee of Ring’s video doorbell unit spied on clients for months with cameras placed in bedrooms and bathrooms.
In addition, Amazon has also agreed to pay $25 million to settle allegations that it grossly violated children’s privacy rights by failing to delete Alexa recordings at the request of parents and keeping them longer than necessary.
These settlements are the latest effort by the Commission to hold big tech companies accountable for policies that put the benefits of data collection ahead of user privacy.
“It’s a very clear signal to them,” FTC Commissioner Ãlvaro Bedoya told Reuters. As part of the agreement, Ring must disclose to customers what kind of access to their personal data the company has and its contractors.
Amazon, which acquired Ring in April 2018, has committed to making some changes to its practices, although it has not acknowledged violating current regulations. “While we disagree with the FTC’s statements regarding both Alexa and Ring, and deny having violated the law, these agreements definitively close these cases,” Jeff Bezos’ company said in a statement.
In its ruling, the FTC asserts that Ring gave employees unrestricted access to customers’ sensitive video data: “As a result of this dangerously excessive access and lax attitude toward privacy and security, Ring’s employees and contractors Third parties were able to view, download, and transfer customers’ confidential video data,” the text states.
The FTC considers it established that a Ring employee was able to view videos of at least 81 customers of the company’s products. “Undetected by Ring, the employee continued to spy for months,” the FTC notes. According to the complaint, the employee gave information about a client’s recordings to the spied person’s ex-husband without her consent. In another case, this worker was found to have given Ring devices to people and then watched videos of him without his knowledge. The employee was fired.
In the case of the Alexa devices, the FTC says the tech giant violated rules protecting children’s privacy. The agency claims that Amazon told users it would remove voice transcripts and location information, but then did not.
“The illegally withheld voice recordings provided Amazon with a valuable database to train the Alexa algorithm to understand children, benefiting at the expense of children’s privacy,” the FTC statement reads.
The FTC is also investigating Amazon’s deal to buy smart home device developer iRobot Corp for $1.7 billion, which was announced in August 2022. These inquiries fall under the Commission’s antitrust policies.
The fines, which total $30.8 million, represent a tiny fraction of the $3.2 billion in profit Amazon generated in the first quarter of 2023.
