FTC Orders 9 Data Brokers to Provide Info on Privacy Practices

The FTC announced today that it had issued orders to nine data brokers to disclosure how they collect and use consumer data. This is consistent with earlier guidance from the FTC, which recommended legislation targeting the data broker industry in its March 2012 Report on Protecting Consumer Privacy:

[T]he Commission recommends that Congress consider enacting targeted legislation to provide greater transparency for, and control over, the practices of information brokers. The proposed framework recommended that companies provide consumers with reasonable access to the data the companies maintain about them, proportionate to the sensitivity of the data and the nature of its use. Several commenters discussed in particular the importance of consumers’ ability to access information that information brokers have about them. These commenters noted the lack of transparency about the practices of information brokers, who often buy, compile, and sell a wealth of highly personal information about consumers but never interact directly with them. Consumers are often unaware of the existence of these entities, as well as the purposes for which they collect and use data.

The Commission agrees that consumers should have more control over the practices of information brokers and believes that appropriate legislation could help address this goal. Any such legislation could be modeled on a bill that the House passed on a bipartisan basis during the 111th Congress, which included a procedure for consumers to access and dispute personal data held by information brokers.

According to today's release, the FTC will use the information provided by the nine data brokers "to prepare a study and to make recommendations on whether, and how, the data broker industry could improve its privacy practices." The FTC's orders (in PDF format) may be downloaded here.