Advertisers need to be vetted, and doing so is the responsibility of website owners.
The investigation found that sites owned by Viacom, Mattel, Hasbro and JumpStart allowed third-party tracking from vendors and marketers.
The State Attorney General's Office announced the findings after a two-year investigation. Every time the user connects to the web site's server, all of the cookies stored by that web site on the user's computer are retrieved and their values are transmitted to the server.
Schneiderman said "dozens" of companies were engaged in illegal activities.
The companies have been ordered to pay penalties totaling $835,000 as a result of the settlement.
The companies agreed to put in place reforms to protect children from such tracking in the future, including regular electronic scans to monitor for third-party tracking technologies and increased vetting of third-party data collection practices, Schneiderman said.
They also agreed to periodically give reports to the NY attorney general proving compliance with the law.
"These settlements send a strong message to companies about the importance of complying with the COPPA Rule", she said.
Mattel said it takes online privacy and security seriously.
While tracking user activity for marketing and advertising purposes is almost ubiquitous on the web, COPPA has prohibited sites that are directed toward children to collect personal information, such as names and email addresses, on kids who are younger than 13 since 1998.
"In some cases, the host companies were not even aware until we told them the tracking technology was on their sites", said Schneiderman.
Viacom will pay $500,000; Mattel will pay $250,000; and JumpStart will pay $85,000.
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