A virtually unregulated class of companies that sells consumers' personal information to marketers is using new technology to dive deeper than ever—peddling quasi-legal lists of alcoholics, addicts, depressives, rape victims, and even "Hispanic payday loan seekers."
That's the conclusion of a new Senate Commerce Committee report, released in conjunction with hearings on the "data broker" industry Wednesday and first reported by the Wall Street Journal. In it, Senate investigators raise questions about a data industry that hoovers up info on Americans "with minimal transparency" and reduces them to bizarre group identifications, like "Rolling the Dice," "Ethnic Second-City Strugglers," and "Rural and Barely Making It," for paying marketers.
Market research on consumers and their habits is nothing new. But data brokers—most notably Axciom, Epsilon, and Experian—have built a $156 billion industry in recent years by data mining consumers' internet and mobile accounts... and possibly by other nefarious but surprisingly legal means.
Sen. Jay Rockefeller (D-W.Va.), chairman of the commerce committee, said at the hearing that, as with revelations about NSA snooping, Americans' sensitive info is regularly getting plumbed for private enterprise, and "the data brokers go about their business with little or no oversight."
The most harrowing accounts, though, came from the Wednesday testimony of World Privacy Forum Director Pam Dixon, who offered printouts of data lists she found available for sale to marketers online. "Privacy laws apply to credit bureaus and health care providers, but data broker activity generally falls outside these laws," she said. "Even a knowledgeable consumer lacks the tools to exercise any control over his or her data held by a data broker."
Among the lists she found for sale:
Home addresses of police officers, 8.5 cents a name.
Rape victims' identities, 7.9 cents apiece.
It's illegal to publish the name of a rape victim in many states.
Locations of domestic violence shelters, 20 cents each.
Dixon pointed out that there are laws on the books to let those shelters keep their locations secret for security reasons.
Genetic disease sufferers, seniors afflicted with dementia, HIV/AIDS sufferers, drug and alcohol addicts, and "Hispanic payday loan" applicants—20 cents apiece for the latters' phone numbers.
Spokesmen for the data brokers had a chance to respond Wednesday, largely insisting that they ran above-board businesses. But, ironically they also demurred when asked to provide more information about themselves to investigators.
"We also have to protect our business, and cannot release proprietary competitive information, or information that we're prohibited from releasing based on contractual agreements with our clients," said Epsilon spokeswoman Diane Bruno.
Sen. John Thune (R-S.D.) spent much of the hearing lavished praise on data brokers , commending them for "helping to fuel job creation and technical innovation in our slowly recovering economy" in his opening statement.
"Put simply, this industry is at the center of something the Commerce Committee cares about – commerce," he said.