Back in July, New York's Attorney General sued Tagged.com for invasion of privacy.   On Monday, Andrew Cuomo announced that the social networking site has settled with the state, and will pay half a million dollars in penalties and fees.

Cuomo announced that his office has stopped the social networking site Tagged.com from misusing contacts and identities of its members and from sending out millions of deceptive and unsolicited promotional emails.

Through an agreement with Cuomo's office, the company must pay $500,000 in penalties and costs to the state and adopt industry-leading measures regarding the access and use of its members' personal information.

Back in the summer, the AG announced his intent to sue the company for deceptive acts after his office learned Tagged had sent more than 60 million misleading emails stating that Tagged members had posted private photos online for their friends to view. In reality, no such photos existed and the email was not from their friends.

When people received the fraudulent emails and tried to access the photos, they were told that they had to sign up for Tagged.com. The company would then deceptively gain access to the new members' personal email contacts to send out more fraudulent invitations.

Tagged must now adopt a series of stringent reforms designed to set an industry standard for how social networking sites send out invitation emails.