Federal Trade Commissioner Tilts at Big Data Windmill

A U.S. Federal Trade Commissioner is urging consumers to take more control over their data.The call to action comes as revelations that the NSA is spying on Americans to an unprecedented degree continue to shake the country. Unease has been mounting over the amount of data companies are handing over to the agency.

Commissioner Julie Brill on Wednesday proposed a new program, dubbed “Reclaim Your Name,” that would require data brokers to develop a one-stop online shop to let consumers control their data. It would also require credit bureaus to develop a system that would incorporate corrections consumers make to their data into all of their databases.

“Among the privacy harms discussed, improper use of data by data brokers is a very significant consumer problem,” said Pam Dixon, executive director of the World Privacy Forum, who was present at Brill’s speech.

“I think she’s right on target,” Dixon told the E-Commerce Times.

Whether the program is feasible in a day and age when corporations are increasingly leveraging Big Data for marketing and the White House defends the NSA’s snooping on all Americans by invoking the specter of national security remains open to question.

The FTC is distancing itself from Brill’s campaign.

“These are Commissioner Brill’s remarks,” commission spokesperson Peter Kaplan told the E-Commerce Times. “They don’t represent the views of the whole commission.”

What Brill Suggests

Highlighting Target’s efforts to identify pregnant customers through their purchases in order to market to them as an example of the impact of Big Data, Brill suggested Congress pass legislation to let consumers manage their data.

In the meantime, the Reclaim Your Name initiative could be implemented, she said.

It would let consumers find out how brokers are collecting and using their data; give them access to that data; let them opt out if they learn brokers are selling that data for marketing purposes; and let them correct errors in information used for substantive decisions associated with credit, insurance, employment and so forth.

“Data brokers compile dossiers about us from online and offline sources and … that information is used to make all sorts of decisions about people,” said John Simpson, consumer advocate at Consumer Watchdog. “We don’t even know what’s in our files.”

Many brokers have data that’s inaccurate, Paul Stephens at Privacy Rights Clearinghouse, told the E-Commerce Times.

Brill wants data brokers to develop a user-friendly one-stop online shop that would let consumers control their data. The more sensitive the data, the greater the transparency — and the more robust the notice and choice brokers would have to provide.

“There are hundreds of specialty credit bureaus that are regulated under the Fair Credit Reporting Act, and no one knows who they are, where they are, or how to find them,” the World Privacy Forum’s Dixon said. “It’s extremely important that the FTC creates a clearing house where we can all see who has our data, and I think that’s what [Brill’s] referring to.”

A two-pronged solution to the problem is needed, Consumer Watchdog’s Simpson told the E-Commerce Times. “Consumers need access when they want it, and there needs to be legislation regulating data brokers’ practices.”

An Impossible Dream?

Consumers all too readily give up their personal information to online sites in exchange for free services. Further, payment transaction records generate “vast amounts” of data that companies are seeking to leverage to generate additional revenue streams from, according to Barclays.

Data analytics represents a growing incremental revenue opportunity for the payments industry, and personal cardholder information is among the most valuable data. The market revenue opportunity will be US$3.5 billion in 2015.

Meanwhile, Microsoft, HP and other vendors constantly monitor consumers’ PCs for security reasons and maintenance, and new Internet-connected consumer appliances such as washers and dryers report back to vendors. Some new cars also monitor drivers’ locations and other information.

Whether the “Reclaim Your Name” proposal will really help consumers manage their data remains to be seen.

“It’s real easy to call for things, but it’s much more difficult to implement them,” Dixon said. “There has to be a discussion as to how this has to happen.”