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The case of LG's spying smart TVs "looks like a clear example of deception," said David Jacobs, consumer protection counsel for the Electronic Privacy Information Center. "The company represents that users can control the disclosure of their data, and this representation turns out to be false. This violates the FTC Act and a host of analogous state consumer protection laws."LG Electronics on Thursday said it is preparing a firmware update to address concerns over the discovery that some of its smart TVs have been monitoring users' viewing habits and sending the information back to the company without owners' consent.The issue was discovered when UK-based IT consultant Jason Huntley found that his LG smart TV had logged the channels he was watching and sent that data back to the company. Huntley, who blogged about his findings on Monday, reported that he discovered a setting called "Collection of watching info," which is set on by default. Even after he had disabled the feature, however, Huntley's TV continued to collect data, including the channel he was watching, he said.Huntley also discovered that the LG Smart AD platform is designed to analyze programs watched by users as well as other online behavior such as search keywords used, and that this data can be provided to potential advertisers. (This included any additional items connected to the TV, i.e. any harddrive connected and also reported which videos etc that may have been watched.LG, which is currently the world's second-largest TV maker, introduced its ad platform in 2012 as a way to target smart TV users. It now claims that it did not intend to gather personal information. 'No Data Will Be Transmitted' "Recently, it has been brought to our attention that there is an issue related to viewing information allegedly being gathered without consent," said LG in a statement provided to the E-Commerce Times by John Taylor, vice president of public affairs and communications at LG Electronics USA. "Our customers' privacy is a very important part of the Smart TV experience, so we began an immediate investigation into these claims."The information being collected is strictly viewing information such as channel, TV platform and broadcast source, but does not include personal data, LG maintains. Nonetheless, it is working on an update that will disable data transmission when users turn off the data-collection setting."This information is collected as part of the Smart TV platform to deliver more relevant advertisements and to offer recommendations to viewers based on what other LG Smart TV owners are watching," LG said. "We have verified that even when this function is turned off by the viewers, it continues to transmit viewing information, although the data is not retained by the server. A firmware update is being prepared for immediate rollout that will correct this problem on all affected LG Smart TVs so when this feature is disabled, no data will be transmitted."LG regrets any concerns these reports may have caused and will continue to strive to meet the expectations of all our customers and the public," the company added.Addendum -As for the USB scanning, LG says that was the first sign of an unannounced feature it was planning to unveil in the near future, which would pull down media information from the internet based on what the set believes users were watching.