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Consumer Data Rights Are Serious Business

Stocks in this article: P SNE GOOG

NEW YORK ( TheStreet) -- As social media companies like Pandora (P) and Facebook continue to draw scrutiny for privacy concerns, and hacking attempts plague Sony (SNE) and many others, security experts issued words of caution to business leaders.

The message from David Vladeck, director of the FTC's bureau of consumer protection, boils down to: Don't gather data unless it's completely necessary.

"If you don't want to see us, don't collect data you don't need that's unrelated to the functionality of your app," he said at the Web 2.0 conference Tuesday in San Francisco. "It's an albatross that can come back and really bite you."

Protecting children's privacy is one of the biggest concerns the FTC is currently addressing, Vladeck said. Several mobile app makers are targeting children under 12 and pulling data including their e-mail addresses and geo-location, which is prohibited under the Children's Online Privacy Protection Act.

Mobile developer Broken Thumbs Apps settled a dispute with the FTC in August over its app Emily's Dress Up and Shop, which is targeted towards children, following allegations it violated the legislation.

Data security is another significant area of interest to the FTC, though one where it isn't making much progress, Vladeck admitted.

"Data we think should be held in the most secure way, like social security numbers, aren't being protected with the vigilance that is required," he said. "Time and time again our investigations show very lax security measures that don't meet any reasonable standard."

A wave of tech companies have been hit by security issues in the last few months, including most notably Sony, whose PlayStation Network was breached by hackers in April who stole names, addresses and birth dates from 100 million users.

Game makers Sega and Nintendo were also targeted by hackers, as was Google (GOOG), whose G-mail service was targeted by attacks in China.

-- Written by Olivia Oran in New York.

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