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NY Attorney General:Social-Networking Site Tagged.com Penalized

By Chad Bray, Of DOW JONES NEWSWIRES

NEW YORK -(Dow Jones)- Social-networking Web site Tagged.com has agreed to pay $500,000 in civil penalties and to make changes in how it sends out promotional e-mails after being accused of engaging in deceptive business practices, New York Attorney General Andrew Cuomo said Monday.

Cuomo had alleged the Web site misappropriated contact lists and the identities of it members in order to send out millions of deceptive and misleading emails to entice others to join the Web site.

"Unsuspecting users had no idea that Tagged had hijacked the e-mail addresses of their colleagues, families and friends for the purpose of blasting them with spam," Cuomo said.

Cuomo threatened to sue Tagged.com in June, alleging the Web site had sent more than 60 million misleading e-mails stating that Tagged.com members had posted private photos online for their friends to view when no photos existed. The company then told recipients of the e-mails they had to sign up to the Web site to view the photos, Cuomo said.

The invitations were constructed to appear as if they had been sent directly from members' personal e-mail accounts instead of from the company, Cuomo said.

As part of its settlement with the attorney general's office, Tagged.com will adopt a series of reforms, including providing clear and conspicuous disclosures when asking for access to a new user's e-mail contacts and no longer accessing those contacts or send messages on behalf of a Tagged.com member without that member's informed permission, Cuomo said.

Before sending out e-mail invitations, the company must also verify the e- mails with new members to make sure they do not inadvertently invite everyone on their contact lists, Cuomo said.

-By Chad Bray, Dow Jones Newswires, 212-227-2017; chad.bray@dowjones.com

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