White House pledges to crack down on 'abusive' data-harvesting companies
By Chris Matthews
The CFPB plans to issue new rules expanding the scope of federal privacy laws
The Biden administration is highlighting its efforts to combat abuses in the consumer-data industry, with regulators such as the Consumer Financial Protection Bureau planning on issuing new rules and pledging aggressive oversight of so-called data brokers that compile and sell data on millions of Americans.
"President Biden has called for stronger privacy protections to limit the personal data that companies collect on Americans," Arati Prabhakar, director of the White House Office of Science and Technology policy, said in a statement. "Protections from abusive data practices will give people more agency over how their data is used."
The CFPB announced Tuesday that it is planning to issue new rules that would expand the number of companies in the surveillance industry covered by the Fair Credit Reporting Act if they sell certain types of consumer data.
It would also tighten rules on so-called credit header data, or information like someone's name, address or Social Security number, which is held by traditional credit bureaus and other organizations and sold to companies who seek to create dossiers on individual consumers.
The rule could make it generally illegal to sell this information unless it's requested because a consumer is seeking a loan or another permissible purpose outlined in federal law.
The CFPB launched a public inquiry into the data-broker industry in March and received more than 7,000 comments from the public. Commenters said companies are selling "highly sensitive information" and that data is being "shared in ways that consumers would not expect," the agency said in a fact sheet outlining its rulemaking plans.
Consumer advocates have been sounding the alarm on these trends for years, and the Federal Trade Commission issued a report nearly a decade ago calling on Congress to expand regulators powers to oversee in the industry.
In February, a coalition of consumer advocate groups sent a letter to CFPB Chairman Rohit Chopra asking the agency to use existing federal laws to "rein in widespread harmful behavior" by the industry, citing companies like RELX (REN.AE) and Thomson Reuters (TRI.T) as "occupying the top of the personal-data food chain" and in need of stricter oversight.
Regulatory efforts to oversee the industry have met with mixed success. In May, a federal judge in Idaho dismissed a lawsuit brought by the FTC against Kochava, a location-data broker, for lack of sufficient evidence of unlawful behavior. The FTC amended and refiled the lawsuit in June and the case is still pending.
The CFPB announcement will coincide with a roundtable event to be held at the White House on protecting Americans from harmful data-broker practices. The discussion will include the White House's Prabhakar, National Economic Council Director Lael Brainard, Chopra and Federal Trade Commission Chairwoman Lina Khan.
"We applaud the steps the Consumer Protection Financial Bureau is taking to stop data brokers from unlawfully collecting and selling millions of Americans' sensitive data," Brainard said in a statement. "The CFPB's proposals would help protect our most vulnerable consumers from targeted fraud and scams."
-Chris Matthews
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
08-15-23 0500ET
Copyright (c) 2023 Dow Jones & Company, Inc.-
Why Immigration Has Boosted Job Gains and the Economy
-
What to Invest in During High Inflation
-
Never Mind Market Efficiency: Are the Markets Sensible?
-
Starbucks Stock Could Use a Pick-Me-Up After Big Selloff; Is it a Buy?
-
5 Cheap Stocks to Buy From an Attractive Part of the Market
-
Markets Brief: All Eyes On Inflation
-
5 Things We Learned From the Q1 Earnings Season
-
After Earnings, Is Palantir Stock a Buy, a Sell, or Fairly Valued?
-
Going Into Earnings, Is Target Stock a Buy, a Sell, or Fairly Valued?
-
Walmart Earnings: Low Prices and Strong Digital Presence Drive Market Share Gains
-
After Earnings and a Big Selloff, Is Shopify Stock a Buy, a Sell, or Fairly Valued?
-
Cisco Earnings: Positive Guidance and Splunk Inclusion Align With Our Long-Term Thesis
-
3 Warren Buffett Stocks to Buy After Berkshire Hathaway’s Just-Released 13F Filing
-
Going Into Earnings, Is Nvidia Stock a Buy, a Sell, or Fairly Valued?
-
After Earnings, Is Arista Stock a Buy, a Sell, or Fairly Valued?
-
A Cheap Dividend Aristocrat to Buy Before It Bounces Back