Student Marketing Group Settles With New York AGStudent Marketing Group Inc. and the Educational Research Center of America said yesterday that they settled a deceptive-trade-practices lawsuit filed by the New York state attorney general.
Attorney General Eliot Spitzer filed the suit in August charging that the firms used deceptive practices in the collection of student information.
The complaint said that list brokerage Student Marketing Group, which specializes in data for the child and young-adult markets, deceived students into divulging their personal information through its not-for-profit organization, the Educational Research Center of America. The research organization has mailed surveys funded by the company to teachers yearly since 1999, according to the complaint.
Accompanying the surveys were cover letters explaining that data collected would be used "by universities and colleges nationally in their ongoing efforts to communicate and keep in touch with the interests and trends among today's high school students" and by financial aid and student scholarship agencies "to evaluate and make funding available for students' post-secondary education," according to Spitzer's office.
However, the data were sold and used to market items including magazines, music videos, credit cards, clothes, cosmetics and student loans, a use not mentioned in the cover letter, the attorney general's office charged.
While the list brokerage and nonprofit settled to avoid litigation, neither admitted to any wrongdoing or violation of law. They did agree to ensure that future efforts to collect personally identifiable information include specific disclosures that the information may be used for non-educational marketing purposes.
Though the attorney general's office said in August that it would seek fines in the case, none were collected, according to Student Marketing Group.
Calls to Spitzer's office for comment were not returned.