Antitrust Law Daily Wrap Up, PRIVACY NEWS: FTC Consumer Protection Director Rich discusses importance of privacy protections to businesses handling consumer data in speech to IAPP, (Dec 11, 2013)
By Linda O’Brien, J.D., LL.M.
Jessica Rich, Director of the FTC Bureau of Consumer Protection, discussed the importance of strong privacy and security protections to businesses handling consumer data and the FTC’s privacy agenda in a speech delivered on December 6 before the International Association of Privacy Professionals (IAPP) in Washington, D.C.
Rich opened her speech, entitled “Privacy Today and the FTC’s 2014 Privacy Agency,” by addressing the important issue of privacy in light of the consumer demand for mobile devices that offer new conveniences and the increased use of data by companies to create better products and services. While consumers have embraced the incredible developments in device connectivity, they question where all of the collected data is going.
This question drives much of what the FTC does, Rich noted. Protecting consumer privacy is one of the FTC’s most important missions. Although the Commission’s priorities and activities have varied, its central goal to protect consumer privacy in order to foster trust in the marketplace and in a way that preserves innovation has remained constant.
Privacy today. Privacy is important to businesses today as it has increasingly become part of a broader business strategy as consumer awareness and demand for privacy grows. Surveys of consumers show not only rising levels of concern but also concrete actions that consumers have taken to shield their personal information. Rich pointed out that privacy and security breaches by companies in the past, such as Google’s launch of the Buzz social network using consumer email contacts, has resulted in regulatory action and consumer backlash.
Improved transparency and consumer choice is a selling point for businesses, according to Rich. Privacy can provide business with a competitive edge. Similarly, marketing and advertising groups have agreed to privacy codes of conduct even though some of them do not directly interact with consumers, Rich observed.
FTC’s privacy agenda. Privacy is a top priority for the FTC, according to Rich. The Commission promotes strong privacy protections using enforcement, workshops, studies, reports, and consumer and business education and outreach. The FTC has also brought hundreds of privacy and data security cases , distributed millions of copies of educational materials for consumers and businesses, and examined the implications of new technologies on consumer privacy through ongoing policy initiatives.
Rich addressed one area of the FTC’s focus that is the phenomenon of “Big Data,” which is the vast capabilities of companies to gather data from numerous sources and analyze it to make inferences about people. While Big Data can drive valuable innovation, the pooling of vast stores of data raises obvious consumer concerns stemming from the risks of indiscriminate data collection without consumer consent, data breaches , and companies that make inferences about consumers that are untrue.
In the near future, the FTC will be releasing a report on data brokers, which is an area of particular concern. Data brokers collect, maintain and sell a wealth of information about consumers but often do not interact directly with consumers. Consumers are unaware of the existence of data brokers or the purposes for which they collect and use consumer data. The purpose of the report is to shed light on the data broker industry and increase transparency about its practices. The FTC will also continue to aggressively enforce the Fair Credit Reporting Act (FCRA) which sets forth procedures for governing the use of data to make decisions regarding consumer credit, employment and insurance.
Mobile technology. Mobile technology and connected devices have become one of the main privacy priorities for the FTC, said Rich. The FTC has issued several reports on mobile security and been active on the enforcement front by bringing its first case against a mobile device manufacturer. Recently, the FTC hosted a workshop, entitled the “Internet of Things” that brought together academics, industry representatives, and consumer advocates to explore privacy and security issues.
Rich concluded by emphasizing the FTC will continue to focus on Big Data, connected devices, and protecting sensitive data in 2014. The FTC will keep reminding companies to implement its three privacy principles - Privacy-By-Design, Transparency, and Simplified Choice - and support robust self-regulation.
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