Proposed new rule aimed at data broker industry would protect consumer data

Proposed federal rule would increase protections for consumer data

A proposed new rule aims to keep your sensitive personal information from being sold. The government agency behind the effort says it would protect Americans from scams – and even more sinister concerns too.

WASHINGTON - A proposed new rule aims to keep your sensitive personal information from being sold. The government agency behind the effort says it would protect Americans from scams – and even more sinister concerns too.

The new rule is being proposed by the Consumer Financial Protection Bureau. They’re looking to rein in the data broker industry, which officials said collects detailed information about Americans’ personal lives and finances, and then they sell it to anyone who’s willing to pay.

On a call with media, CFPB Director Rohit Chopra ran through a series of incidents in which he said data brokers enabled scammers, stalkers, and even spies.

In one instance from 2020, a federal judge’s son was murdered by an attacker who bought the judge’s home address from a data broker, Chopra said.

He also mentioned a breach from last summer, when hackers accessed nearly three billion records of Americans’ sensitive data, including social security numbers, with all of it coming from a single broker.

Beyond that, Chopra said an investigation revealed how easily data brokers can track U.S. military personnel stationed in Germany and that researchers also demonstrated how they could purchase location data to track federal law enforcement as they conducted confidential investigations.

The CFPB’s new rule would treat data brokers just like credit bureaus and background check companies, meaning they’d have to comply with certain laws, according to officials.

They said the rule would also aim to protect consumers’ personal information from misuse, and it would require clear consumer consent for data to be shared.

"It’s long overdue," Lou Rabon, founder and CEO of Cyber Defense Group, said Tuesday. "Anyone that is angry at someone else online can easily go online, do a name search or a phone number search, and find out massive amounts of personal information on someone, and everyone’s confused. How did they know this? It’s because of the data brokerage industry."

FOX 5 reached out to several of the most prominent data brokers Tuesday for comment but did not immediately hear back.

The rule is still months away from being finalized, with the CFPB accepting public comment through early March.