META - Teleadoc-owned BetterHelp settles with FTC for data mishandling

Teleadoc ( NYSE: TDOC )-owned metal health company BetterHelp has agreed to pay $7.8M in a settlement with the Federal Trade Commission (FTC) over allegations of sharing customers' sensitive health data with third parties for marketing without their consent, the agency said Thursday.

The settlement, which also required BetterHelp to change its business practices, was approved by the FTC in a 4 – 0 vote on Thursday. The company will use $7.8M to provide partial refunds for affected users.

Per the terms of the deal which has yet to be finalized by a judge, BetterHelp will be barred from sharing consumers' health data with Meta ( META ) and other third parties for marketing purposes. If the company intends to share the data for any additional purposes, it will have to obtain express consent from consumers.

BetterHelp will also have to put in place a privacy program and set limits for the duration of data storage. It will have to make sure the third parties will delete the data sent by the company previously.

The FTC accused BetterHelp of sharing personal health information with Facebook of Meta ( META ), Snap's ( SNAP ) Snapchat, Criteo ( CRTO ), and Pinterest ( PINS ) for advertising purposes.

"This industry-standard practice is routinely used by some of the largest health providers, health systems, and healthcare brands," BetterHelp said in a statement. "Nonetheless, we understand the FTC's desire to set new precedents."

Meanwhile, in its 10-K filing on Wednesday, Teladoc ( TDOC ) disclosed a $7.8M charge to cover a potential loss arising from an FTC investigation related to allegations of unfair business practices at its BetterHelp unit.

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