CDD and U.S. PIRG Call on FTC to Develop Stronger Online Privacy Framework

 

For Immediate Release

Contact: Jeff Chester (202-494-7100)

February 18, 2011

jeff@democraticmedia.org

Center for Digital Democracy

www.democraticmedia.org

 

 

CDD and U.S. PIRG Call on Federal Trade Commission to Develop

Much Stronger Online Privacy and Consumer Protection Safeguards

Urge FTC to Implement Do-Not-Track System Online

Groups Criticize Industry Self-Regulation as Insufficient

18 February 2011/Washington, DC: In comments filed today with the Federal Trade Commission, the Center for Digital Democracy and U.S. PIRG called for much stronger consumer privacy safeguards in the online marketplace. Writing in response to the preliminary staff report released last December by the FTC--“Protecting Consumer Privacy in an Era of Rapid Change: A Proposed Framework for Businesses and Policymakers”--the groups provided a detailed analysis of the sophisticated tracking and targeting system that now confronts consumers online.

 

“Today’s consumers should not be expected to be able to make informed decisions about how to protect their privacy in a system purposefully shaped to foster data collection through ‘360-degree’ and other invasive digital marketing strategies,” the groups’ filing explained. They called for a new era of choice and transparency in the online marketplace, arming consumers with the defenses they need--both the knowledge to understand the system of data collection that is now the default online, and the power to reject that system if they so desired--to withstand the assault on their privacy.

 

“Both the privacy and welfare of consumers in the U.S. are being placed at risk every day, by what online marketers refer to as the era of ‘Big Data,’” observed CDD’s Jeff Chester. “Consumers today confront a powerful and far-reaching data collection and targeting system that uses advanced and largely stealth means to extract information and influence their decisions--including for sensitive transactions involving finance, health, and families. The FTC must be in the forefront of ensuring that privacy is safeguarded, and that online transactions involving sensitive information and posing significant personal costs to consumers are structured in a fair and transparent manner.”

 

The groups’ 40-page filing offered a detailed view of the inner workings of the online marketplace, where access to individual consumers is auctioned off in milliseconds, and where behavioral data compiled online are combined with offline databases to create detailed profiles of specific individuals. In the face of such a sophisticated, and largely covert, tracking and targeting, system, CDD and U.S. PIRG called for basic privacy protections to be put in place online: full disclosure of the surveillance technologies that exist, access to the personal profiles that result from that system in order to correct or suppress such data, and the option--through a Do-Not-Track system--to bypass such profiling entirely.

 

“Consumers who were victimized during the subprime mortgage era, or those who were sold unaffordable loans for education,” noted Ed Mierzwinski, Consumer Program Director for U.S. PIRG, “should not have to remain vulnerable to new forms of unfair database marketing that combine offline and online data. Consumers are increasingly at risk today regarding the information and offers they receive for such critical matters as mortgages, credit, insurance, private college loans, and health information. No consumer can be expected to understand--let alone control--the array of sophisticated and pervasive data mining and personalized targeting techniques that confront them in today’s online digital marketplace. The use of sensitive data by marketers requires the FTC to quickly adopt new consumer privacy safeguards.”

 

CDD and U.S. PIRG urged the FTC to dismiss the self-serving claims of industry that new privacy regulations would stifle the online marketplace. On the contrary, the groups’ filing declared, renewed consumer confidence in the privacy and security of their online transactions--no longer the sieve of sensitive data that it has become today--would only serve to invigorate the online marketplace.

 

 

The Center for Digital Democracy is a nonprofit group working to educate the public about the impact of digital marketing on public health, consumer protection, and privacy. It has played a leading role at the FTC and in Congress to help promote the development of legal safeguards for behavioral targeting and other online data collection practices.

 

U.S. PIRG serves as the federation of non-profit, non-partisan state Public Interest Research Groups. PIRGs are public interest advocacy organizations that take on powerful interests on behalf of their members. For twenty years, U.S. PIRG has been concerned with privacy and compliance by governments and commercial firms with Fair Information Practices.