SAN FRANCISCO -- Data brokers who collect vast amounts of information on Americans will be the ones turning over information this time.
The Federal Trade Commission has ordered nine data brokerage companies to tell the agency how they harvest and use data on consumers, toughening its stance toward the multibillion-dollar industry.
The FTC said it plans to use the information it collects to study the industry’s privacy practices. The nine data brokers are Acxiom, Corelogic, Datalogix, EBureau, ID Analytics, Intelius, Peekyou, Rapleaf, and Recorded Future.
The FTC wants to know what the brokers do with the information. It also wants to know if the data brokers let consumers review and correct their personal information or opt out from having their personal information sold.
Data brokers are not required by law to disclose to consumers the information they collect.
The FTC has tried to persuade data brokers to create a centralized website to tell consumers how they handle their information. It has also urged Congress to pass a law that would require data brokers to let people examine the detailed dossiers gleaned from their activities on Web and mobile devices, similar to federal laws that give consumers free access to their credit reports once a year.
The FTC has also taken action against data brokers. In June, Pasadena company Spokeo agreed to pay $800,000 to settle charges it illegally sold personal information for employment screening.
Data brokers collect, analyze and sell information about consumers' behavior online and offline to better target marketing pitches. The industry says this type of data collection benefits consumers who get offers for products and services they are interested in. The Direct Marketing Assn. rolled out a public relations campaign in October to prevent "needless regulation or enforcement that could severely hamper consumer marketing and stifle innovation."
At a congressional hearing last week, FTC Chairman Jon Leibowitz called data brokers "invisible data catchers." He said data brokers can do a lot of good but need to interact with consumers.Watchdogs fear that the unregulated collection of sensitive –- and sometimes inaccurate –- information could affect someone’s ability to land a job, find a place to live or what prices they pay for goods and services. They say most people have no idea the level of detailed information collected on their personal lives. Nor do they know to whom that information is sold or what's done with it.
"The dramatic growth of the data broker industry has created numerous all-seeing eyes spying on Americans every day. Whether offline or on the Internet, data brokers harvest a digital gold mine of infinite details about each of us -- what we buy, who are friends are, how much we earn, our ethnicity, our health concerns," said Jeffrey Chester, executive director of the Center for Digital Democracy. "Today's action by the FTC will unmask this largely stealth consumer surveillance industry."
There are currently two congressional inquiries into the data brokerage industry. In October, Sen. John D. Rockefeller IV opened an investigation into nine data brokers. He said he was alarmed by the amount of personal, medical and financial information that could be collected, analyzed and sold. In July, Rep. Edward Markey and Rep. Joe Barton began a house inquiry into the industry.
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