Privacy Law

FTC report calls for Congress to rein in data brokers

Facing a situation in which data brokers may know more about an individual’s life than that person’s family members and friends, the Federal Trade Commission is asking Congress to enact legislation to rein them in.

In a 110-page report (PDF) released Tuesday, the FTC calls for laws requiring the companies that collect and share information from sources such as credit and loyalty card purchases, Internet searches and social media to reveal to consumers who they are and what they do and provide some opt-out options.

Data brokers “often know as much—or even more—about us than our family and friends, including our online and in-store purchases, our political and religious affiliations, our income and socioeconomic status, and more,” said the commission’s chair, Edith Ramirez, in an FTC press release.

However, such legislation isn’t likely, given a lack of consumer awareness and concern about the extensive profiles, not to mention the industry’s powerful lobby, according to the Washington Post (reg. req.).

“There’s no political pressure on Congress, really, to act. The data-broker lobby is in­cred­ibly powerful,” Jeffrey Chester told the newspaper. He is executive director of the Center for Digital Democracy.

The American Civil Liberties Union also isn’t hopeful about a speedy legislative solution. “This report’s intentions are good, but waiting for Congress to pass new regulations isn’t going to help protect Americans’ privacy rights anytime soon,” the civil rights group said in a written statement provided to the Post. “The FTC needs to start using its existing authority to root out bad practices now.”

At issue, in addition to concerns by some about the extensive information being collected, including sexual preferences and health conditions, are discounts, deals and credit offerings based on data-broker profiles of individuals. While this is portrayed as a useful benefit to consumers by data brokers, it may also cause consumers may to be unfairly or inaccurately denied economic opportunities based on aggregated profiles, privacy advocates argue.

The Plain Dealer, the San Francisco Chronicle and the Wall Street Journal (sub. req.) also have stories.

Related material: “Beyond Big Brother: Some Web Hosts Are Watching Your Every Keystroke” “Is your photo online? Are you on Facebook? If so, retailers can ID you and your shopping profile”

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