Consumer Financial Protection Bureau proposes restricting data brokers from selling personal and financial information

The U.S. Consumer Financial Protection Bureau (CFPB) has proposed rules to curb data brokers that sell Americans' personal identifying information, such as Social Security numbers and phone numbers, as well as financial information.

CFPB Proposes Rule to Stop Data Brokers from Selling Sensitive Personal Data to Scammers, Stalkers, and Spies | Consumer Financial Protection Bureau

US plan to protect consumers from data brokers faces dim future under Trump - Ars Technica
https://arstechnica.com/tech-policy/2024/12/us-plan-to-protect-consumers-from-data-brokers-faces-dim-future-under-trump/

US agency proposes new rule blocking data brokers from selling Americans' sensitive personal data | TechCrunch
https://techcrunch.com/2024/12/03/us-agency-proposes-new-rule-blocking-data-brokers-from-selling-americans-sensitive-personal-data/

In the United States, data brokers are collecting and selling confidential personal information and financial information, which has become a problem. The people buying the information are “countries of concern” such as China and Russia, and the problem is that with a small investment they could be used to conduct espionage and stalking activities.

'Data brokers profit by selling our most sensitive personal information without our knowledge or consent, enabling fraud, stalking, and espionage,' CPFB Director Rohit Chopra said. 'CPFB's proposal would curb this behavior that threatens individual safety and undermines America's national security.'

The CPFB explains that the proposed rule would ensure that data brokers comply with federal law and prevent threats such as:

National security and surveillance risks
'Countries of concern' such as China and Russia could obtain detailed personal information about military personnel, veterans and government officials for a small fee and use it for espionage, surveillance and blackmail.

・Criminal misuse
Fraudsters who obtain financial information about elderly people and those in financial difficulty could commit fraud or steal pensions.

・Violence and stalking
Professionals who are targeted, such as police officers and judges, and victims of domestic violence, may face danger if their information is easily leaked via data brokers. In 2020, a federal judge's son was murdered after a criminal obtained his home address, raising the need for measures to protect judges and law enforcement officials.

The CPFB's proposals for addressing these risks are as follows:

- Treat data brokers on an equal footing with credit bureaus and background check companies
Any company that handles personal credit information, such as financial information or credit scores, is considered a 'consumer reporting agency' that must comply with the Fair Credit Reporting Act (FCRA) regardless of how the information is used.

- Protect consumers' personally identifiable information from misuse or abuse
When a consumer reporting agency collects information such as an individual's name, address, and age for credit reporting purposes, the FCRA protects what the agency subsequently does with that information.

Require explicit consumer consent for data sharing
Companies that handle personal credit information will need to get explicit consent on an individual basis, rather than asking for permission in small print so consumers don't notice.

The CPFB said the proposed rules would significantly curtail data brokers' 'ability to sell sensitive personal information.'