The FTC settled with Zoom for deceiving users about its encryption security and unfairly installing software that bypassed browser safeguards. Zoom must implement a comprehensive security program, undergo biennial audits, and is banned from making false security claims. No monetary penalty was imposed.
Zoom must establish and implement a comprehensive information security program with annual risk assessments, vulnerability management, multi-factor authentication, and data deletion controls. It is prohibited from making misrepresentations about privacy and security. The company must undergo biennial third-party security audits and notify the FTC of any data breaches.
In-house legal teams should review vendor, customer, and data processing agreements for clauses related to security representations, encryption standards, and software installation. Specifically, examine any warranties or descriptions of security features (e.g., 'end-to-end encryption'), terms governing the installation of additional software or plugins, and provisions requiring compliance with specific security programs or audits. Given the FTC's findings, agreements may need amendments to ensure all security claims are accurate and non-misleading, incorporate requirements for a comprehensive security program akin to Zoom's mandated program, and include explicit user consent mechanisms for any software that interacts with or bypasses browser safeguards. Additionally, audit rights and reporting obligations should be strengthened to align with the biennial audit requirement.
Entity
Zoom Video Communications, Inc.
Also known as: Zoom
Industry
TechnologyOfficial Press Release
https://www.ftc.gov/news-events/news/press-releases/2020/11/ftc-requires-zoom-enhance-its-security-practices-part-settlement
1923167zoomacco2
https://www.ftc.gov/system/files/documents/cases/1923167zoomacco2.pdf
1923167zoomcomplaint
https://www.ftc.gov/system/files/documents/cases/1923167zoomcomplaint.pdf
Federal Trade Commission Enforcement Page
https://www.ftc.gov/enforcement
"Zoom Video Communications, Inc."
"FTC Act"
"misled users by touting that it offered “end-to-end, 256-bit encryption”"
"secretly installed software, called a ZoomOpener web server"
The FTC finalized a settlement with Zoom Video Communications, Inc. for misleading consumers about its data security practices and compromising user security. The settlement requires Zoom to implement a comprehensive security program, review software updates for security flaws, and undergo biennial third-party assessments.
$930K
The FTC finalized orders requiring CMG Media Corporation (doing business as Cox Media Group), MindSift LLC, and 1010 Digital Works LLC to pay a total of $930,000 for falsely claiming they offered an AI-powered service that could target ads based on conversations captured from consumers' smart devices, and that consumers had opted into such targeting. The orders also prohibit the companies from making misrepresentations about their advertising services, voice data collection, and consumer consent.
The FTC announced it is seeking public comment on a proposed enforcement policy statement regarding personalized pricing, which is the use of personal data to set prices based on what a company believes an individual consumer is willing to spend. The statement warns that undisclosed collection or use of personal data for personalized pricing could violate the FTC Act's prohibition on unfair or deceptive practices. The Commission voted 2-0 to authorize the Federal Register notice.
$4.0M
The FTC and Connecticut secured a $4 million settlement with Chase Nissan LLC (doing business as Manchester City Nissan) over allegations the dealership charged consumers unauthorized fees, including double-charging for 'certified pre-owned' vehicles and inserting charges like total loss protection into financing agreements without consent. The settlement requires $4 million in consumer redress, prohibits misrepresentations about vehicle certification and warranties, mandates prominent disclosure of the maximum total vehicle price, and requires express informed consent for all charges.
The FTC filed a complaint against Credit Glory LLC and related entities for deceptive credit repair practices, including false promises, impersonating debt collectors, charging illegal upfront fees, and using negative option billing without consent. A federal court temporarily halted the operation.
The FTC issued a policy statement abandoning disparate-impact liability, stating it will no longer bring claims based on this theory. It also modified compliance obligations for several companies based on past decisions.