Cross-posted from
The potential sale of 20 million student records by ConnectEDU, an ed-tech company that filed for bankruptcy in April, has prompted the Federal Trade Commission to step in to protect the student data, the agency announced Friday.
, a 12-year-old Boston-based company, provides interactive tools to help K-12 and post-secondary learners make academic and career decisions. In its privacy policy, ConnectEDU promised that--prior to any sale of the company--registered users would be notified and have the ability to delete their personally identifiable data.
Now, the FTC said that promise appears to be compromised by the potential sale of the company鈥檚 assets, including the student data, to North Atlantic Capital, a Portland, Me.-based venture capital fund. As a result, the commission--by a vote of 5-0--authorized its consumer protection bureau to write a letter to the bankruptcy court that will rule on the asset sale.
The letter indicates that the terms of the sale of the company and its subsidiary Academic Management Systems Inc. in bankruptcy do not provide consumers the notice and choice set forth in the privacy policy and could .
鈥淥n the ConnectEDU website, students have built personal listings of their academic and personal interests, honors and awards, and work experience; employed resume builders, test preparation, and financial literacy tools; and engaged with networks of teachers, mentors, and potential employers,鈥� Jessica Rich, director of the FTC Bureau of Consumer Protection, wrote in the
Rich indicated that the FTC鈥檚 concerns would be 鈥済reatly diminished鈥� if ConnectEDU provided users with notice of the sale of their personal information, and those users were given a chance to remove it, or if the personal information was destroyed.
The U.S. Department of Education applauded the move on Friday. 鈥淯sers of online educational tools should be able to trust that companies will use their personal information in accordance with both the companies鈥� stated privacy policies and applicable federal legal requirements, including the Family Educational Rights and Privacy Act (commonly known as FERPA),鈥� said Dorie Nolt, department press officer, in a written statement.
鈥淭his clearly demonstrates the case that the FTC is actively looking to protect students鈥� privacy, and those companies that don鈥檛 follow through with privacy practices might be in the FTC鈥檚 crosshairs,鈥� said Bradley Shear, a social-media and digital-privacy lawyer based in Bethesda, Md.
ConnectEDU filed Chapter 11 bankruptcy in April, listing between $10 million and $50 million in liabilities against less than $10 million in assets, according to . Last July, the company was awarded a from the Bill & Melinda Gates Foundation to build an innovative technology platform that would empower students to master Common Core standards for literacy through an engaging, personalized, and collaborative-learning experience.