(Reuters) – The sale of Americans’ private information by “data brokers” to scammers, foreign adversaries, abusive domestic partners and other unscrupulous actors could face stringent new proposed regulations, the top U.S. consumer agency for financial protection announced on Tuesday.
If adopted, the proposed new rules would subject “data brokers” to oversight by the Consumer Financial Protection Bureau, requiring them to comply with credit reporting laws, thereby reining in a practice officials say poses threats to national security and public safety.
“The scale of this problem is staggering,” CFPB Director Rohit Chopra told reporters ahead of the announcement, citing research according to which some data brokers explicitly advertised the sale of senior national security officials’ personal information.
The proposal also comes in the final weeks of President Joe Biden’s administration, meaning its fate will be determined after President-elect Donald Trump, who has pledged sweeping cuts to spending and regulations, takes office in January.
Unlike other regulators, CFPB officials have decided to continue rulemaking in the hopes that some new consumer protections may survive the change in administration, Reuters reported last week.
CFPB officials said they believed the subject nevertheless enjoyed “broad bipartisan recognition.”
Under the proposal, companies that obtain and sell consumers’ personal financial information – such as income data, net worth and credit ratings – would be regulated like credit bureaus and required to maintain safeguards against the misuse of data, to ensure its accuracy and allow consumers to access their own information.
The proposal flows from a broader Biden administration concern with personal data use. The Federal Trade Commission in 2022 sued an Idaho company, saying its mobile phone geolocation data could be traced to abortion clinics, churches and addiction treatment facilities.
CFPB officials say the unrestricted sale of such data for pennies per person enables espionage, allows thieves to target financially vulnerable people and allows potentially violent actors to target law enforcement officials and others.
Officials traced the 2020 murder of a federal judge’s son to a man who had purchased her home address, according to the CFPB.
The proposal will be subject to public comment until March 2025.
Source: Economy - investing.com
