Ashley Madison’s parent company pays US$1.6M in settlements with U.S. government

The investigation was launched last year when a massive security breach exposed the personal dealings and financial information of millions.

The Toronto-based parent company of the infidelity dating site Ashley Madison said Wednesday it hoped to have turned the page after reaching settlements in an investigation led by the U.S. Federal Trade Commission.

Ruby Corp., which was previously known as Avid Life Media, said it has paid more than US$1.6 million in settlements, with half the money going to the FTC and half to the states participating in the probe.

The company said that as part of the agreement, it will also maintain a comprehensive information security program and “refrain from past business practices that may have allegedly been misleading to consumers.”

But it stressed it neither admits nor denies the allegations made by the FTC and the various state attorneys general.

“We’re very pleased to have it resolved,” said Rob Segal, the company’s CEO. “It closes a chapter on the company’s past and I think it reinforces our commitment to operating with integrity, building a new future for our members and our team and the company.”

The investigation was launched last year after a massive security breach that exposed the personal dealings and financial information of millions of purported clients.

The hack made international headlines and cost Ruby Corp. about a quarter of its annual revenue, the company has said.

Asked Wednesday whether it had bounced back financially, Ruby Corp. said it is “stable” and “optimistic about the future.”

Ashley Madison was also the subject of investigations by privacy officials in Canada and Australia, which concluded in August and found the site had inadequate security safeguards and policies when it was targeted by hackers.

The Office of the Privacy Commissioner of Canada and the Office of the Australian Information Commissioner say their investigation identified numerous violations of the privacy laws of both countries.

Ashley Madison was also plagued by allegations that it resorted to fake profiles of women — commonly known as bots – to lure unsuspecting male customers.

The company had consistently denied the accusations but said earlier this year that a report found the bots were still active in some parts of the world until late 2015.

Ashley Madison underwent a major rebranding earlier this year in an effort to bounce back from the breach, and even dropped its signature tagline “Life is short. Have an affair.”

 

Paola Loriggio, The Canadian Press

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