Big Data is watching all of us

I’m a glass-half-empty person.

I say this as a way to express my feelings about a report released by the Federal Trade Commission on data brokers, companies that collect and sell consumer information.

“For decades, policymakers have expressed concerns about the lack of transparency of companies that buy and sell consumer data without direct consumer interaction,” the FTC says.

The FTC took an in-depth look at nine data brokers who collect information — online and off — to verify people’s identity, detect fraud and to market products. So, it’s an industry that knows a lot about your personal business.

Consider this from the report. One broker’s database has information on 1.4 billion consumer transactions. Another’s store of information covers $1 trillion in consumer transactions. One broker adds 3 billion new records each month to its databases.

Before you get completely outraged about this, there are some benefits to the collection of all your data. Knowing your patterns can help prevent companies from being duped by crooks pretending to be you. However, as many people have discovered, there are also many downsides to the storing of your data. Consider the following, according to the FTC:

Consumers can be turned down for products based on an error or errors in reports they never knew existed. One data broker recently settled charges brought by the FTC after the agency said the firm had violated the Fair Credit Reporting Act by failing to assure information it obtained from sex offender registry records matched the specific job applicants they were researching. In many instances they got it wrong, the FTC said.

Data brokers often create marketing categories based on your information, including your shopping history. But placing you in a particular segment might end up costing you money. “For example, while a data broker could infer that a consumer belongs in a data segment for ‘biker enthusiasts,’ which would allow a motorcycle dealership to offer the consumer coupons, an insurance company using that same segment might infer that the consumer engages in risky behavior,” the FTC notes. In the insurance business, higher risk often means higher premiums.

Your information doesn’t die. Some of the data brokers store all data indefinitely. There can be a history of your old home addresses. But just like such data can stop identity thieves, it can also help them. Such information can help criminals crack security questions or predict your passwords.

After looking at the industry, the FTC says Congress needs to pass legislation that will enable consumers to find out what is being collected about them.

There were three recommendations in particular from the FTC that I hope will be taken up by Congress:

Give consumers access to their own data, including any sensitive information.

Provide clear and easy ways for people to opt out of having their data collected and sold.

Require companies to disclose where they got information or the data source so that consumers can correct errors.

Washington Post Writers Group

More in Herald Business Journal

Peoples, HomeStreet banks bump lowest salaries after tax cut

The banks with Snohomish County branches will raise minimum salaries for employees to $15 an hour.

Electroimpact cuts Mukilteo staff by 9 percent

“What we’re missing now is a monster anchor project,” the company’s VP said.

Exotic animals find compassionate care in Bothell (video)

At the Center for Bird and Exotic Animal Medicine, vets treat snakes, hedgehogs and even kangaroos.

How can you tell if you are getting good financial advice?

Assume that it’s still the same buyer-beware market that has always existed.

Amanda Strong (left) tries on an Angel of the Winds Arena hat as she and Courtney Brown hand out gift bags after the renaming ceremony Dec. 13 in Everett. The new name replaces the Xfinity name. (Andy Bronson / Her file)
Angel of the Winds to break ground on $60M casino expansion

“We think we’re on the cusp of becoming a major resort.”

In this Dec. 20, 2017, photo, a clerk reaches to a shelf to pick an item for a customer order at the Amazon Prime warehouse, in New York. (AP Photo/Mark Lennihan, File)
Amazon’s potential HQ2 sites leaves many cities disappointed

And yet, some municipal leaders are looking at the bright side of being rejected.

How do you retrieve an errant Boeing 737 from a muddy slope?

Turkish authorities used cranes to lift a plane that skidded off a runway.

Don’t take economic forecasts to the bank — or the casino

Air travel delays could spur a rebirth of passenger rail service.

Emirates orders 20 more Airbus A380 jumbos, saving program

The Dubai carrier also has options to buy 16 more. The program seems safe until 2029.

Most Read