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Debit Card Apps For Kids Are Collecting a Shocking Amount of Personal Data (vice.com) 51

Posted by BeauHD from the fintech-for-kids dept.
An anonymous reader quotes a report from Motherboard: The fintech company Greenlight says that its app and debit card for kids is a financial literacy tool that gives parents "superpowers" to set strict controls on their children's spending. Parents can use the app to pay allowances, choose which stores the connected debit cards work at, set spending limits, and receive instant notifications whenever their child makes a purchase. But there's one thing Greenlight makes it very hard for parents to control: What the company does with the mountains of sensitive data it collects about children. Greenlight reserves the right to share that personal information -- including names, birth dates, email addresses, GPS location history, purchase history, and behavioral profiles -- with "ad and marketing vendors," "insurance companies," "collection agencies," and the catch-all category of "other service providers," according to its privacy policy. Greenlight's policy also says that it can use the data it collects to deliver "tailored content" advertisements, a kind of marketing that youth privacy and education advocates say is particularly manipulative and damaging for children.

The Atlanta-based company told Motherboard that, despite what parents must agree to when they sign up for the app, Greenlight doesn't "monetize or sell customer data in any way." In an email, a company spokesperson said Greenlight inserted those permissions into its privacy policy "in case we ever decide to offer merchant-funded offers to parents in the future based on aggregated and anonymous information." The permissions listed in the policy do not just apply to aggregated and anonymous information, however. They appear under sections titled "Personal Information We Collect and How," "How we Use Personal Information," and "How We Share Personal Information." They also do not only apply to parents, because by signing up for the service, parents must sign away the data rights of their children as well.
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Debit Card Apps For Kids Are Collecting a Shocking Amount of Personal Data More

Debit Card Apps For Kids Are Collecting a Shocking Amount of Personal Data

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  • This is legal? (Score:4, Insightful)

    by Mal-2 ( 675116 ) on Tuesday July 06, 2021 @07:06PM (#61557347) Homepage Journal

    This is legal, but somehow the same kids aren't supposed to use Audacity? What a fucking week.

    • To be fair, their agreement sounds like boiler-plate legal stuff. I don't particularly like the sound of it either, but there's quite a bit of difference between some standard "may do" language and what they're actually doing (which we apparently don't know). For what it's worth, and given that we're talking about children (though I'd rather this for the rest of us as well)...yeah, there should probably be some laws on the books concerning this.

    • This is legal ...

      It is not legal: COPPA [wikipedia.org]

      Greenlight's defence is "We are only asserting our right to commit <illegal act>, but we aren't actually doing it.

      Most likely, some programmer slapped together the privacy statement and no lawyer saw it before it was published. If a lawyer saw it and allowed it to be published, they should be disbarred.

      • Re: (Score:2)

        by Luckyo ( 1726890 )

        Wikipedia page you linked suggests that everything mentioned is legal if legal guardian consents. It also mentions attempts to tighten legislation up to ban those things outright.

        Am I missing something? I'm not a fan of reading US legislation, as it's written to be unnecessarily complex, but I'll go do it if you point me at the specific part.

      • Re: (Score:2)

        by EvilSS ( 557649 )

        This is legal ...

        It is not legal: COPPA [wikipedia.org]

        Greenlight's defence is "We are only asserting our right to commit <illegal act>, but we aren't actually doing it.

        Most likely, some programmer slapped together the privacy statement and no lawyer saw it before it was published. If a lawyer saw it and allowed it to be published, they should be disbarred.

        I was thinking the same thing, but if you read the second link in the summary, there is a COPPA section and from the looks of it, they are complying with it.

      • Re:This is legal? (Score:4, Informative)

        by jwhyche ( 6192 ) on Wednesday July 07, 2021 @09:43AM (#61558917) Homepage

        Why do you even need to get a debit card specifically for kids? When my kids turned 13, I went to the bank, got two prepaid debit cards, and connected them to my main bank account. Using my phone app I could send money to ether of those cards, I could see what they where spending money on, and even restrict access to the cards.

        I could do everything with those cards that can be done wth Greenlights. But with one key difference. These cards where in my name so nobody was monitoring my kids but me.

        Screw these cards just for kids. They are completely unnecessary.

  • You don't say! (Score:5, Insightful)

    by sarren1901 ( 5415506 ) on Tuesday July 06, 2021 @07:06PM (#61557349)

    You mean an application an on handheld computer that has a constant Internet connection and collecting and phoning home data about usage? Say it ain't so.

    • You mean an application an on handheld computer that has a constant Internet connection and collecting and phoning home data about usage? Say it ain't so.

      Just because the technical ability to harvest data exists, doesn't make it legal to collect and resell it.

      Greenlight's privacy notice appears to be a clear COPPA [wikipedia.org] violation.

      • Re: (Score:3)

        by Luckyo ( 1726890 )

        I followed your wikipedia link, and then went to sources:

        https://www.ftc.gov/tips-advic... [ftc.gov]

        Section C paragraph 9:

        I know that the Rule requires that I provide a direct notice to parents before I collect personal information from children. What information must be included in the direct notice?

        The Rule requires operators to make reasonable efforts, taking into account available technology, to ensure that a parent of a child receives direct notice of the operator’s practices with regard to the collection,

      • Re: (Score:2)

        by EvilSS ( 557649 )
        If you actually read it, you will find they address COPPA in their policy.

  • Just make it illegal to collect the data. No sane, honorable person thinks collecting data on kids is fair or a good idea.

     

    • Toy companies might.

    • Why not? If i make games for kids of course I'm interested in what they like, which parts of the game they find more interesting, which parts more annoying, how old they are, etc. So as long as I don't collect personally identifiable data (full names, precise addresses, etc) why should I be banned from collecting data that could make my products better for my audience?

      Of course the parents must agree with sharing these kinds of data with me, but i don't see a reason why the government should decide in place

  • ... choose which stores the connected debit cards work at, set spending limits, and receive instant notifications whenever their child makes a purchase.

    Those would probably be nice features for any debit/credit card ...

    My CC supports notifications for purchases -- I don't (and never will) have a debit card...

    • Re: (Score:1)

      by Anonymous Coward

      Are you stoned?

      Collecting names, birth dates, email addresses, GPS location history, purchase history, and behavioral profiles and selling it to "ad and marketing vendors," "insurance companies," "collection agencies," and "other service providers" is shady as fuck. Not to mention unnecessary.

  • Let's just set the visceral hyperbole aside for a second..

    Banking regulations brought about by 9/11 require all financial institutions to collect a "shocking amount" of personal data from every customer, because they must be able to identify the actual person who is opening an account. Of course, this "shocking amount" of personal data includes name, address, and social security number.

    Banking regulations also require that every bank send a statement to the customer, and that statement must contain a record

    • For kids, not adults.

      • Except that at least the regulations I have read do not differentiate between children and adults. Note that that is the Finnish regulations in this case based on EU directives, not US.

        But there are a LOT of laws with bit different formulations but same basic idea.

        Some laws:
        *The Act on Detecting and Preventing Money Laundering and Terrorist Financing (Money Laundering Act)
        *The Credit Institutions Act
        *The Insurance Companies Act
        *The Investment Firms Act
        *The Mutual Funds Act
        *The Payment Institutions Act
        *The A

    • It is not only 9/11 as cause, it is also the tighter money laundering controls in general.

      And the actual records contain a lot more information than listed above. Banks in most countries are required to do all kinds of stuff with the data to try to identify money laundering and related things.

      When many banks fail/have failed at such they got/get fined quite large sums, so they and all other banks are collecting and analyzing more data and more in an attempt to not have to identify such things.

    • Re: (Score:1)

      by Anonymous Coward

      > GPS location history, purchase history, and behavioral profiles

      No part of that is related to banking regulation or required for reporting. That extraneous information is collected from minors and sold off to any buyer for any reason. It is wrong. What am I doing about it? Avoiding companies like Greenlight.

    • Re: (Score:2)

      by Bert64 ( 520050 )

      There's a difference between collecting data that's necessary to provide the service, and collecting/using data for things unrelated to providing the service - like selling ads, selling data to third parties etc.

  • Give them an allowance in real money. As in cold, hard, old-fashioned cash. Teach them that privacy and anonymity are important, and that even you, their parent, won't set up the infrastructure to spy on them.

    I'm glad that many cities like NYC have passed laws mandating that stores and restaurants take real cash, not fake bankster scrip.

    That's the scary thing about credit/debit cards and electronic payments in general. Once you withdraw cash, YOU decide where you can spend it. With "modern" forms of pay

    • Give them an allowance in real money. As in cold, hard, old-fashioned cash.

      A debit card is safer than cash.

      Theft is much less of an issue, and I can see exactly what my kid is spending her money on

      I got my daughter a debit card when she was eight. That was 14 years ago.

      • So you want to control your kids. Why not just let them be kids, just like you were a kid without your parental units tracking you 24/7/365 via an e-leash and crap card?

        • Re: (Score:2)

          by Luckyo ( 1726890 )

          Helicopter parenting has become a norm in modern culture. That's one genie we're not shoving back into the bottle with any meaningful ease.

          I still remember the moment I was told by a friend how his family got into a serious altercation with law when they went to work in US for a while. Problem was that they let their kids act like they would back home, i.e. they'd just go places within certain distance of home with no adult supervision. It's utterly absurd that this would even be a matter for law enforcemen

        • Re:Teach your children well... (Score:4, Informative)

          by ShanghaiBill ( 739463 ) on Wednesday July 07, 2021 @12:40AM (#61557917)

          So you want to control your kids.

          Keeping an eye on your kids is not "controlling" them.

          Several times, she went to her friend's house to "work on a school project" and an hour later, I could see debits on her card at Forever 21 at the mall, and I could confirm the location with the GPS tracking app on her phone.

          Do you know what I did?

          Nothing. Kids lie. Shopping instead of studying is what teenage girls do. I don't keep an eye on her for that.

          I keep an eye on her so that when she calls me at 2 am and says, "Daddy, I'm scared, and I don't know where I am", I can tell her that I know where she is, and I will be there in 15 minutes.

          just like you were a kid without your parental units tracking you

          Back in the "good ole' days" before cellphones, sexual violence against young women was twice what it is today.

    • Re: (Score:2)

      by Bert64 ( 520050 )

      There are many situations where cash is inconvenient or doesn't work at all.
      With cash i'm limited to the retailers i can reasonably travel to, and the stock they keep. There are many items which i might want to purchase, but which aren't stocked by local retailers and i have to order from further away - sometimes even from foreign countries.

  • This is not shocking in the least.
  • There is a dangerous "pattern in the data" that seems to be emerging as more of these stories come to light.

    Up until the start of the "fintech revolution", personal finances were handled either by banks, credit unions or mutuals. The services they provided were "un-sexy", somewhat staid and generally rather boring. These financial services were also largely separate from the "social media mind-set", which is basically a model of "the user is the product" and one in which the more information that can be
  • Get em ready for the consumerist mindset early. They'll have a harder job of questioning why they're buying the useless rubbish they're buying later on in life if it's ingrained at a more fundamental level.

    • Re: (Score:2)

      by Jezral ( 449476 )

      Debit cards for kids is even a thing?

      Absolutely it's a thing. I made sure my daughter got her own bank account and debit card shortly after she turned 7. That makes it so easier to manage allowance and everything else. Nobody wants to deal with cash.

      Money is abstract these days, and the sooner you learn to keep a mental handle on how much money you have in the bank vs. how much you're spending, the better you're set up for reality. And learning about managing money in the abstract sense is equally useful for the rare cases where you get handed

      • I want to deal with cash. It's private and doesn't require a middleman's gracious permission to spend.

  • Oh yeah...

    Fucking DUH! What do you expect?

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