Facebook Inc. (FB) Has 5.6M Child Accounts, Despite Ban

Facebook Inc. (NASDAQ:FB) does have prohibitions and a tiered screening process in order to try to filter out children under the age of 13 from setting up accounts and accessing its social-networking site. However, the company has a secret that it hasn’t disclosed to investors in its SEC paperwork  and refused to acknowledge due to federal law – Facebook (NASDAQ:FB) has about 5.6 million accounts in the U.S. (about 3.5 percent of its U.S. total) that belong to children who are under age 13.

Facebook Inc (FB), JetBlue Airways Corporation (JBLU)

A 1998 federal law called the Children’s Online Privacy Protection Act (COPPA) requires Web sites to give special treatment to Internet users under the age of 13. Facebook Inc. (NASDAQ:FB), like many Web sites, prohibits younger Internet users  from using their sites or building accounts. However as the 5.6 million number indicates, despite Facebook’s tiered screening system, there are ways that children can work around the system and have access to Facebook and other sites. The goal of the law was to prevent online marketers from targeting children in their advertising. The Federal Trade Commission is due to finalize some new rules to further compel Web sites to restrict access to their sites by young children, though Facebook Inc. (NASDAQ:FB) claims that the new regulations wouldn’t apply to it because it has explicit warnings and prhibitios of younger users.

However, Reuters tested the Facebook Inc. (NASDAQ:FB) protocol, and while a fake child’s account registration was denied, an hour later that account was allowed with the same information (name, e-mail address,etc.) except for the birth year. The reason? Facebook Inc. (NASDAQ:FB) is not allowed by COPPA to save data from younger users or account registrants. A study revealed, though, that Facebook’s screening process does seem to eliminate about 800,000 child accounts on an annual basis, which is apparently progress from the company.

Filtering out children from the Facebook Inc. (NASDAQ:FB) account records might reduce its user numbers by nearly 4 percent, but it’s possible that investors in Facebook stock, like hedge-fund manager Chase Coleman of Tiger Global Management LLC, will appreciate the efforts that Facebook makes to cleans its Web site of the most vulnerable demographic.

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
Click here to Read Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 74 percentage points in 2.5 years. Our beta is only 1.2 (download a FREE newsletter and see the details inside)

Lists

Best Selling Magazines in the World

Shortest People in History

The Most Celebrated Holidays in the World

Most Expensive Handbag Brands in the World

Top Selling Comic Book Issues of this Century

The Most Powerful Women in Politics

Best Paid DJs

Most Rebellious Female Artists

Best Paid TV Actresses of 2014

Best Paid Actors of 2014

Most Expensive Horses in the World

Tallest People Ever

Most Encouraging Feminist Celebrities

Best Paid Supermodels of 2014

Top 10 Suburbs for Retirement in 2015

10 Wealthiest Cities in America

Top 10 TED Talks for Entrepreneurs

Best TED Talks on Education

25 Most Dangerous Places to Live in America

Top 10 Ski Resorts in the United States – 2014 List

Top 10 Most Remote Places in the World

Most Visited Museums in the United States

Wealthiest Photographers in the World

Most Famous Gay Athletes

The World’s Most Famous Circuses

Best Hair Stylists

Most Popular NASCAR Drivers

The Best Romance Movies of all Time

The Most Wanted Drug Lords

The Oldest Money Managers

The Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!