February 25, 2020

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Bill Introduced to Require Data Brokers to Register With FTC

On July 30, 2019, Sens. Peters and McSally introduced S.2342, a bill to provide for requirements for data brokers with respect to the acquisition, use and protection of brokered personal information, and to require that data brokers annually register with the Federal Trade Commission. 

Congress should bring more transparency to data broker practices through the FTC, Sens. Gary Peters, D-Mich. and Martha McSally, R-Ariz. have stated.

According to Peters, policymakers and the public deserve to know the identities of data brokers.  According to McSally, data is gathered and consumers scored without any knowledge of the industry practices.  McSally also believes that brokers are potentially circumventing laws like the Fair Credit Reporting Act, which requires data collected by credit reporting agencies to be transparent and allows consumers to correct the record.  In doing, however, McSally has dismissed the idea that Facebook’s Cambridge Analytica scandal played any role in the construction of the bill.

In 2014, FTC attorneys made various legislative and best practice recommendations to increase data broker transparency and user control.  In doing so, the agency asked Congress to consider legislation to require the creation of a centralized mechanism, such as an Internet portal, where data brokers can identify themselves, describe their information collection and use practices, and provide links to access tools and opt-outs.  The FTC also called for legislation that would require data brokers to, without limitation, give consumers access to their data, including any sensitive data, at a reasonable level of detail, and to require opt-out tools for consumers to suppress the use of their data.

The proposed legislation comes following the enactment of Vermont’s groundbreaking data broker disclosure and security legislation.

The bill has since been referred to the Committee on Commerce, Science, and Transportation.

© 2020 Hinch Newman LLP


About this Author

Richard Newman, FTC Defense Lawyer, Internet Marketing, Hinch Newman Law Firm

Richard B. Newman is one of the premier FTC advertising compliance and regulatory defense attorneys in the United States.  He regularly provides advertising counsel and represents clients in high-profile investigations (CIDs) and enforcement proceedings initiated by the Federal Trade Commission, state attorneys general, departments of consumer affairs, and other federal and state agencies with jurisdiction over advertising and marketing practices.  Richard also handles  transactional matters relating to the dissemination of national advertising campaigns, including the...