Why Privacy Compliance is Crucial for Your Business

In today’s digital age, protecting consumer privacy and adhering to regulatory standards is more important than ever. The recent case involving Upromise, a membership rewards service, underscores the critical need for businesses to follow through on their privacy promises, especially when it comes to handling sensitive consumer data. After failing to meet the terms of a Federal Trade Commission (“FTC”) order, Upromise now faces a significant penalty and heightened scrutiny. This serves as a powerful reminder for businesses of all sizes to remain vigilant and ensure they are fully compliant with privacy laws and consumer protection regulations. Upromise, which helps consumers save for college through rewards programs, has been the subject of legal action following its mishandling of data collection practices. Back in 2012, the FTC issued an order requiring the company to make clear disclosures about how it collected and used consumer data via a toolbar called “RewardU.” Additionally, Upromise was directed to obtain third-party privacy assessments to verify that proper safeguards were in place to protect consumers’ personal information. However, despite these explicit requirements, Upromise failed to adhere to these obligations, resulting in a civil penalty of $500,000.