Toys that 'spy' on kids are becoming a growing threat, report finds

Toys that "spy" on children are becoming a larger threat risk, according to a consumer watchdog report shared just ahead of the holiday gifting season.

The warning from the U.S. Public Interest Research Group Education Fund comes along with its annual "Trouble in Toyland" report, with this year's report  focusing on issues with the "smart toy" industry.

As items from the continuously growing industry most likely make their way atop your child's Christmas list, the agency is pushing parents to recognize the potential risks that may come along with them.

"It's chilling to learn what some of these toys can do," said Teresa Murray, consumer watchdog at U.S. PIRG Education Fund and co-author of the report. "Smart toys can be useful, fun or educational, but interacting with some of them can create frightening situations for too many families." 

Smart toys can include anything with a camera, microphone, internet connectivity, location trackers and other technological features. 

According to the report, the smart toys industry is expected to more than double within the next four years, after already growing from $14.1 billion last year to $16.7 billion this year.

However, the report questions why these features are increasingly being included in things that didn't necessarily need them, such as a soccer ball with an accompanying app or toy cars with sensors that respond to hand motions.

Though parents may find that some of these toys carry an increase in benefits, the U.S. PIRG Education Fund says parents need to fully understand the bandwidth of these additions before allowing the toys in their child's hands.

For example, the consumer advocacy group stresses some of these toys can surreptitiously — if a parent doesn't check privacy protections — be used to collect data on children, which can be sent to and stored in company database systems. This poses the possibility of data breaches, child protection law violations and other safety risks.

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The group also notes that the growth of artificial intelligence can exacerbate these potential issues, as the experimental technology spans into toys used by those who don't understand its abilities.

So before you grab that smart-talking doll or habit-learning device for your little one this holiday season, the U.S. PIRG Education Fund says there are two big questions you may want to look into first:

Does the toy allow the child to connect to the internet and send emails or connect to social media?

Does it have a microphone or camera? If so, when will it record, and will you know it's recording?

Digging deeper, the consumer watchdog group's report included swaths of questions you may want to ask depending on what you find when asking those two questions, such as: If it has a microphone, and there are recordings, are those being stored? And where?

For a full list of potential questions, click here to read the report.

The U.S. PIRG Education Fund's warning comes two months after an 11-year-old girl was kidnapped by a man who encountered her while playing Roblox, one of the most downloaded mobile games this year. She was found safe soon after, 135 miles away from home.

It also comes on the heels of the Federal Trade Commission accusing Amazon and its Alexa service of violating federal children's privacy laws in the spring by keeping voice recordings indefinitely, even when parents requested the clips of their children be deleted.