Enforcement

Read the 2013 NAI Annual Compliance Report

Archives: Previous Years' Compliance Report

Last updated: July 1, 2014

The NAI requires all member companies to comply with the NAI's Self-Regulatory Code of Conduct, which imposes notice, choice, transparency, education, and data security requirements on members, along with other obligations, with respect to the collection and use of data for Interest-Based Advertising. 

The NAI relies on different tools to assess the status of compliance with business aspects of the NAI code:

  1. NAI members complete a detailed questionnaire and provide specific assurances of compliance during NAI’s annual mandatory review process.  During this process, members of the NAI compliance staff review members’ business practices and interview company officials to assess if companies follow the NAI Code.  
  2. NAI’s technical monitoring tool allows for regular checks of member compliance with NAI requirements for opt-out functionality by scanning the web to detect possible issues with recognizing and honoring opt-out requests.

Pre-Certification:

Applicants to the NAI must undergo pre-certification reviews to help ensure that they have policies and procedures in place capable of meeting the requirements of the NAI Code. NAI staff reviews each applicant’s data collection, use, and sharing practices as well as their public representations concerning such practices.  NAI staff also tests the technical functionality of applicants’ opt-out mechanisms, and ensures its compatibility with the NAI industry opt-out tool.

NAI staff reviews company documents to assess whether notice and choice are provided to consumers where data is collected and used for Interest-Based Advertising, and that data is protected in accordance with NAI standards. 

Staff members may provide their perspective on practices to help companies go above and beyond the requirements of the NAI Code.  However, NAI staff cannot advise applicants on their individual legal obligations.

Compliance Reviews

Membership in the NAI requires public representations, subject to enforcement by the Federal Trade Commission, that a member’s business practices comply with each aspect of the Code that applies to its business model.  In addition to reviewing the Interest-Based Advertising-related business practices and policies of all applicants prior to their membership in NAI, NAI staff reviews member companies on a regular basis. 

All NAI member companies are required to reaffirm their compliance with the NAI Code and to undergo annual compliance reviews. These reviews proactively examine companies' Interest-Based Advertising-related business practices and public representations against the requirements of the Code. 

The NAI compliance team evaluates NAI members based on their responses to questionnaires that address issues such as business-to-business contracts and internal practices and procedures, their consumer-facing policies and other public representations, as well as their underlying opt-out technology infrastructures. The review process also serves to educate and remind NAI members about their ongoing responsibilities under the NAI Code, and the sanctions that can result if they do not honor their commitments.

The NAI takes a proactive approach in helping members address and fix the issues detected by these compliance activities.  If found not in compliance, a member can work with NAI staff to implement changes to the member’s practices.  This process, which necessarily relies on input from members, is intended to help member companies identify potential issues with business practices before they become significant and costly problems. 

Confirming the proper functioning of the NAI opt-out tool is one of the central functions of the NAI compliance effort.  In addition to these annual reviews, NAI staff monitors members throughout the year in an effort to confirm that they are honoring opt-out requests.  NAI uses technical tools to continuously monitor and help identify technical malfunctions or other errors that might result in an opt-out failure.

NAI staff also investigates public allegations of non-compliance with the NAI Code, whether raised by media reports, advocates, academics, or any other source. 

You can learn more about our compliance program by reading the NAI's past annual reports.  Links to the NAI's published annual reports are provided above.

Consumer Complaints

Consumers who believe that one or more NAI member company has violated the NAI Code may file a complaint with NAI staff.  NAI staff reviews and, if warranted, investigates these complaints.  NAI’s goal is to identify any evidence of non-compliance with the NAI Code, and to remedy issues as quickly as possible.

When a consumer complaint or other inquiry is received, NAI staff first seeks to determine whether it concerns an NAI member, and whether it relates to compliance with the NAI Code.  NAI staff resolves the vast majority of addressable consumers’ questions and concerns by responding directly to the consumers.  If the complaint raises a technical problem or concern that NAI staff cannot remedy alone, NAI staff refers the matter to the affected member company.  If NAI staff finds that the complaint alleges potential material non-compliance with the NAI Code, the matter may be referred to the NAI Board of Directors with a recommendation for sanctions, as discussed below. To read more about our consumer complaints procedures, click here.

Sanctions

If an investigation results in a finding by NAI staff that a member company’s actions involved a potential material violation of the NAI Code, NAI staff may refer the matter to the NAI Board of Directors with a recommendation for sanctions. The member company is given the opportunity to address the Board and respond to a staff finding of non-compliance.  If the NAI Board determines that the member has violated the NAI Code, the NAI may impose sanctions, including suspension or revocation of membership, and may refer the matter to the Federal Trade Commission.

Annual Reporting

The NAI produces and publishes annual reports summarizing the results of its compliance reviews, its testing of members' technology to ensure that opt-out tools function properly, and of consumer complaints received.

To learn more about the NAI's enforcement procedures, click here. Links to the NAI's published annual reports are provided above.

 

 *Please return to this page frequently to learn of updates and additional guidance to our Code and Compliance program and to review the annual reports generated by the NAI.