Path, in a statement on its website, said it has closed a "very small number" of accounts affected by the COPPA rule.
"There was a period of time where our system was not automatically rejecting people who indicated that they were under 13," Path said. "Before the FTC reached out to us, we discovered and fixed this sign-up process qualification, and took further action by suspending any under age accounts that had mistakenly been allowed to be created."
Path said it hopes it can help other developers learn from its experience.
The FTC action should remind others "of the importance of making sure services are in full compliance with rules like COPPA," the company said. "From a developer's perspective, we understand the tendency to focus all attention on the process of building amazing new things. It wasn't until we gave our account verification system a second look that we realized there was a problem."
The FTC announced the settlement with Path on the same day as the agency released recommendations for mobile privacy practices.
Sign up for CIO Asia eNewsletters.