The Federal Trade Commission called on data brokers to be more transparent and give users more control over their personal information in a comprehensive report issued yesterday.
The 100-plus page document, “Data Brokers: A Call for Transparency and Acccountability,” (.PDF) criticizes the industry for operating with what it calls a “fundamental lack of transparency” and encourages Congress to make an effort to transform broker practices, make them clearer to consumers and to curb privacy implications.
The report, a cross-section of nine unnamed data brokers, takes a look at how many of them obtain user information and go on to sell that information for marketing campaigns, highlighting the privacy concerns along the way.
The FTC deduced the amount of data these brokers process is vast, to say the least.
One of the data brokers analyzed was found holding information on more than 1.4 billion consumer transactions and 700 billion data elements. Data elements include information such as consumers’ interests, purchases, magazine subscriptions and website visits, information that brokers take and break down into lists. That’s of course in addition to the traditional statistics brokers gather on users like their age, race and income.
One data broker’s database covered $1 trillion in consumer transactions while another broker added a staggering three billion records each month.
As a result of their research, the FTC is insisting Congress consider enacting some sort of legislation that would allow consumers to learn of the “existence and activities of data brokers” and allow them “reasonable access to information about them held by these entities.”
In addition to several best practice recommendations such as privacy-by-design and restricting data collection on minors, the FTC is hoping Congress put something into motion that will let users know about their data and give them the ability to opt out of having it shared for marketing purposes.
“It’s time to bring transparency and accountability to bear on this industry on behalf of consumers, many of whom are unaware that data brokers even exist,” said FTC Chairwoman Edith Ramirez on a conference call Tuesday.
The report follows up a similar report from the White House earlier this month that also urged data brokers to be more transparent of the swathes of information they harvest. That report, on the collection and usage of big data, advocated for national data breach legislation and an update to the Electronic Communications Privacy Act.
Senators Edward Markey (D-MA) and John D. Rockefeller (D-WV) introduced a data broker bill, The Data Broker Accountability and Transparency Act of 2014, back in February but critics, especially those vocal about privacy, are skeptical it makes much of a dent given politicians’ vested interests in data acquisition.