WASHINGTON, D.C. — The Federal Trade Commission finalized settlements requiring Cox Media Group and two marketing firms to pay a combined $930,000 over allegations they falsely marketed an artificial intelligence-powered advertising service as capable of targeting consumers based on conversations captured through smart devices.
Cox Media Group, operated by CMG Media Corp., must pay $880,000, while MindSift LLC and 1010 Digital Works LLC will each pay $25,000, the FTC stated. The money will be used to provide redress to Cox Media Group customers affected by the practices.
The settlements resolve complaints first disclosed in May involving an advertising product promoted as “Active Listening.”
The FTC alleged that Cox Media Group, New Hampshire-based MindSift and Wisconsin-based 1010 Digital Works told customers that a specialized algorithm could detect relevant conversations through consumers’ smart devices and use that information to target advertising within particular geographic areas.
The service did not actually rely on voice data, according to the agency, and consumers had not opted into the advertised form of targeting.
The FTC also concluded that had the technology operated as represented, collecting and using consumers’ voice data without adequate consent would itself have violated the FTC Act.
Under the final orders, all three companies are prohibited from misrepresenting the features or capabilities of their advertising and marketing services. The restrictions specifically cover claims about collecting or using voice data, obtaining consumer consent and geographically targeting advertisements.
The case addresses both the accuracy of claims made to advertising customers and the privacy implications of marketing technology purported to use conversations collected from connected devices.
The commission voted 2-0 to give final approval to the consent agreements after receiving two public comments on the proposed settlements.
Support the local news that supports Chester County. MyChesCo delivers reliable, fact-based reporting and essential community resources—free for everyone. If you value that, click here to become a patron today.