August 15, 2022
FTC warns of crackdown on companies making false claims of protecting personal data
The Federal Trade Commission is warning that it will go after corporations that make false claims about how they are protecting personal data of consumers.  FTC acting Associate Director Kristin Cohen said unprecedented privacy intrusions by companies collecting Americans’ data are no longer “the stuff of dystopian fiction.” “Companies that make false claims about anonymization…

The Federal Trade Commission is warning that it will go after corporations that make false claims about how they are protecting personal data of consumers. 

FTC acting Associate Director Kristin Cohen said unprecedented privacy intrusions by companies collecting Americans’ data are no longer “the stuff of dystopian fiction.”

“Companies that make false claims about anonymization can expect to hear from the FTC,” Ms. Cohen wrote on the regulator’s blog this week. “The FTC cracks down on companies that misuse consumers’ data. As recent cases have shown, the FTC does not tolerate companies that over-collect, indefinitely retain, or misuse consumer data.”

Ms. Cohen cited the example of a 2021 settlement with Flo Health, a women’s period and fertility tracking app, which the FTC alleged shared users’ health data with third parties, including Facebook and Google, despite pledging to keep the information private. The FTC announced that settlement in January 2021 just before President Biden took office. 

The agency did not identify specific targets of Ms. Cohen’s warning but listed sensitive categories of data subject to abuse, including location and health information. Ms. Cohen also noted that several devices are responsible for collecting such data, including smartphones, cars, wearable fitness trackers and internet browsers.

“The commission is committed to using the full scope of its legal authorities to protect consumers’ privacy,” Ms. Cohen wrote. “We will vigorously enforce the law if we uncover illegal conduct that exploits Americans’ location, health or other sensitive data.”

Ms. Cohen said criminals may use the compromised data for scams and identity theft, and information about reproductive health may subject people to “discrimination, stigma, mental anguish or other serious harms.” 

Last week, three Democrats from the House Committee on Oversight and Reform said they were investigating the sale of personal data related to pregnant women seeking abortions. 

Data privacy concerns are not limited to domestic criminals, however. American researcher Christopher Balding said last month that he discovered evidence that China collected data through domestically made smart coffee machines that were exported around the world, including to America. 

Mr. Balding’s report with New Kite Data Labs focused on internet-connected coffee makers made by the China-based Kalerm, but other web-linked devices may pose privacy dangers too. Home appliances from robotic vacuums to thermostats using machine learning are among the devices that generate data potentially of interest to criminals and others looking to exploit vulnerable people.  

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