The sale of sensitive personal information generates more than $250 billion a year, but a new federal rule could regulate data brokers. The U.S. Consumer Financial Protection Bureau’s proposed new rule would require companies to have explicit authorization from consumers to share sensitive personal and financial information.
According to a press release, the sold personal data can be used to target people, perpetrate violence and divulge location history.
“All of us leave our financial fingerprints everywhere, every day, between credit card swipes, internet communications, and more,” Bartlett Naylor, financial policy advocate for Public Citizen, said. “Thieves, loan sharks, stalkers, even foreign espionage agents can exploit gaping holes in credit reporting enforcement that the CFPB is rightly proposing to repair.”
The new rule will require that “any company that sells information about a consumer’s credit history, credit score, debt payments, or income must follow the Fair Credit Reporting Act’s rules for consumer reporting” and therefore, “restrict the purposes for which data brokers could sell information,” Gizmodo reported.
“Scammers use this data to prey on seniors, who lost more than $3.4 billion in 2023, an increase of 11 percent over the previous year,” Naylor said. “Stalkers can perpetrate violence, including one who murdered a judge’s son after purchasing her home address. Bad actors can even purchase individually identified information about active-duty military members’ income, net worth, and credit rating, as well as sensitive contact information, raising the possibility of coercion, blackmail, or espionage.”
The proposed rule would restrict the sale of specific personal identifiers such as social security numbers and home addresses, since the sale of sensitive personal and financial information is currently covered in a “blanket agreement that is buried in fine print.”
“This means they could no longer dodge their obligations and would need to follow the same consumer protection rules as major credit bureaus, including accuracy requirements and providing consumers access to their information,” Chopra said.
The Consumer Financial Protection Bureau’s (CFPB) proposed rule is being hailed as the most significant federal effort in years to stop the sale of individuals’ personal data and location history for any purpose to anyone.
“Persistent tracking by data brokers can put millions of Americans at risk, exposing the precise locations where service members are stationed or which medical treatments someone is seeking,” Lina Khan, FTC director, said.
However, “it would do little to restrict American law enforcement and spy agencies from purchasing that same sensitive and personally identifiable information,” Gizmodo reported. Data brokers such as Gravy Analytics and Mobilewalla, have been used by federal and state agencies to obtain sensitive information without a warrant and in turn used to profile Americans.
To see a list compiled by PrivacyRights.org, click here to identify all data brokers in your state or those that offer an opt-out process.
COMMENTS