Laptop rental companies reach cash-free, pointless settlement with toothless FTC for taking secret naked pictures of customers having sex, harvesting medical records and banking passwords and more

The FTC has settled with seven rent-to-own companies and a software company called DesignerWare of North East Pennsylvania for their role in secretly installing spyware on rental laptops, which was used to take "pictures of children, individuals not fully clothed, and couples engaged in sexual activities."

Under the terms of the settlement, the companies are free to go on engaging in this behavior, but now they'll have to notify customers. They won't pay a fine. The FTC won't say if it's referred any of the companies for criminal prosecution. The rental companies used the spyware to harvest renters' bank passwords, private emails to doctors, medical records, and Social Security numbers, and they used it to pop up deceptive windows on customers' computers to trick them into entering personal information.

Wired's David Kravets has more:

The software, known as Detective Mode, didn’t just secretly turn on webcams. It “can log the keystrokes of the computer user, take screen shots of the computer user’s activities on the computer, and photograph anyone within view of the computer’s webcam. Detective Mode secretly gathers this information and transmits it to DesignerWare, who then transmits it to the rent-to-own store from which the computer was rented, unbeknownst to the individual using the computer,” according to the complaint.

Under the settlement, the companies can still use tracking software on their rental computers, so long as they advise renters, the FTC said. The companies include Aspen Way Enterprises Inc.; Watershed Development Corp.; Showplace Inc., doing business as Showplace Rent-to-Own; J.A.G. Rents LLC, doing business as ColorTyme; Red Zone Inc., doing business as ColorTyme; B. Stamper Enterprises Inc., doing business as Premier Rental Purchase; and C.A.L.M. Ventures Inc., doing business as Premier Rental Purchase.

Rent-to-Own Laptops Secretly Photographed Users Having Sex, FTC Says