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FTC Bans NGL's App for Minors

The FTC has issued a groundbreaking ban on NGL, an anonymous social app, prohibiting its marketing to users under 18
July 10, 2024

In an unprecedented move, the Federal Trade Commission (FTC) has banned the anonymous social app NGL from being marketed to anyone under 18. The app, launched in 2021, quickly gained popularity for allowing users to post links to their social accounts and receive anonymous questions. However, the FTC, along with the Los Angeles District Attorney’s office, has found the company guilty of several deceptive practices, leading to a $5 million settlement.

The allegations against NGL are serious. The FTC accuses the app and its founders of falsely claiming that their AI content moderation system could effectively filter out harmful messages and cyberbullying. Even more troubling, NGL reportedly sent fake questions to users, masquerading as real inquiries, to trick them into subscribing to a $9.99 monthly service that promised to reveal hints about the question senders.

The FTC asserts that NGL resorted to these fake, computer-generated questions to revive interest in their app, leading users to receive unsettling messages such as “Are you straight?” or “I know what you did.” These messages prompted users to subscribe for hints, only to find out later that the questions came from bots.

“NGL’s bait-and-switch tactic prompted many consumers to complain, which NGL executives laughed off, dismissing such users as ‘suckers’,” the FTC stated.

The complaint also highlights NGL’s failure to clearly disclose recurring charges for its paid services and alleges that the company violated the Children’s Online Privacy Protection Act (COPPA). This act mandates that apps directed at children under 13 must inform parents about the personal information they collect.

FTC Chair Lina Khan condemned NGL’s practices, stating, “NGL marketed its app to kids and teens despite knowing that it was exposing them to cyberbullying and harassment. In light of NGL’s reckless disregard for kids’ safety, the FTC’s order would ban NGL from marketing or offering its app to those under 18. We will keep cracking down on businesses that unlawfully exploit kids for profit.”

As part of the settlement, NGL is required to implement an age gate, preventing users under 18 from accessing the app. The company must also stop misrepresenting message senders and disclose information about recurring charges clearly. Additionally, NGL is prohibited from misrepresenting the capabilities of its AI content moderation system.

NGL co-founder Joao Figueiredo responded to the settlement in a statement to TechCrunch, saying, “After nearly two years of cooperating with the FTC’s investigation, we view this resolution as an opportunity to make NGL better than ever for our users and we think the agreement is in our best interest. While we believe many of the allegations around the youth of our user base are factually incorrect, we anticipate that the agreed upon age-gating and other procedures will now provide direction for others in our space, and hopefully improve policies generally.”

This settlement marks a significant step by the FTC under Chair Lina Khan to safeguard children from potentially harmful social media practices and holds companies accountable for their actions.

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