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Obama proposes privacy measure

Alex Brandon/Associated Press file photo<br><br>Critics say proposed legislation from the Obama administration to require businesses to do more to protect the information they collect about consumers is ineffective because it doesn’t give the Federal Trade Commission authority to adopt rules.

WASHINGTON – Amid “rapid growth” in the collection of data on Americans, the White House on Friday proposed legislation that calls on businesses to do more to help consumers protect their personal information.

The draft bill, first obtained by The Associated Press, gives a nod to consumers fed up with how much of their private lives wind up in the hands of marketers. But the proposal frustrated many privacy advocates, including Democrats on Capitol Hill, who say the bill won’t change much for consumers. They cite several loopholes that would give companies a way to opt out without consequence.

The bill would allow industries to develop their own privacy standards, for example, and startups would be shielded from any punishment during the first 18 months they are in business. The bill also would pre-empt most state privacy laws, which in some cases are much tougher.

“We need to put in place a system of rules that puts consumers in control of their information, not corporate interests and data reapers,” said Sen. Ed Markey, D-Mass.

Tech-savvy marketers have long been tracking people’s movements online as well as their location, pairing that information with such offline data as race, gender, salary, where they live and even how much they paid for their house. The result is a thriving industry of data brokers that make money from selling detailed – and somewhat creepy – profiles of every consumer.

According to a draft, the bill identifies seven principles for safeguarding personal data, including giving Americans the right to access information that companies collect. It says businesses should act in the spirit of transparency and take steps to protect that data from being leaked or misused.

The bill also encourages industries to draft “privacy codes of conduct.” The Federal Trade Commission could take action against a company if it violates its own code. But the regulatory agency, known for suing businesses for unfair and deceptive business practices, wouldn’t be given any rulemaking authority as many privacy advocates want.

“It’s a big victory for the tech industry because it really sidelines the FTC and removes it as an effective force,” said Jeffrey Chester, head of the Center for Digital Democracy.

Some industry officials said they worried the legislation would be a burden to innovative businesses.

The Internet Association, which represents such companies as Google, Facebook and Twitter, said in a statement that the White House proposal “casts a needlessly imprecise net” and could “inadvertently mark a shift from ‘permissionless’ to ‘permission slip’ innovation.”

The White House declined to comment on the pushback from critics. But a fact sheet said the bill was “offered in the spirit of bringing all stakeholders into a public dialogue to advance new privacy protections.”

Under the bill, any company that collects personal data would have to give consumers “reasonable access” to that information or provide an “accurate representation” of the data. Consumers also would be given the opportunity to ask to correct or delete their information. But the company could get out of those requirements under certain circumstances. For example, individuals can be denied access to their data if the request is found to be “frivolous or vexatious.”

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