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DMA: Rockefeller's Proposed Data Law Would Make Info Less Secure

Senator Goes After 'Booming Shadow Industry'

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Sen. Jay Rockefeller wants transparency, security
Sen. Jay Rockefeller wants transparency, security

Expect ad and data industry trade groups to fight new proposed legislation giving consumers greater control over how marketers use their data. Perpetual privacy bill sponsors Sen. Jay Rockefeller, D-W.V., and Sen. Edward Markey D-Mass., yesterday introduced a bill giving consumers access to data held by data brokers serving the marketing industry, allowing them to correct information or opt-out from use of that data for marketing purposes.

The Data Broker Accountability and Transparency Act of 2014, or the DATA Act, would also prevent data companies from harvesting consumer information by "deceptive" means.

The Direct Marketing Association, whose member businesses rely on data commodities to operate a variety of services from direct-mailing list sales to email marketing, attacked the proposed law, suggesting it could become a security headache for companies collecting and sharing consumer information.

"Imposing an access-and-correction regime on marketing data is not necessary to protect consumer privacy and doing so would make it harder for companies to keep data secure at a time when consumers are more concerned about identity theft than ever before," said Peggy Hudson, DMA's senior VP of government affairs.

But that's not the way watchdogs see it. Calling the data broker sector a "booming shadow industry," Mr. Rockefeller noted in a press statement, "Consumers deserve to know what information about their personal lives is being collected and sold to marketers by data brokers."

Mr. Rockefeller in December delivered a forceful shot across the bow of the marketing data industry, admonishing data giants Acxiom, Epsilon and Experian for failing to provide satisfactory information about their practices in an earlier Senate inquiry. "We have a feeling people are getting scammed or screwed," he said during a Senate Commerce Committee hearing.

"I'm putting these three companies on notice today...that I am considering further steps and I have steps I can use to get this information."

Consider the DATA Act proposal to be an initial step. The elder West Virginia statesman is nearing his final months in office and will not run for re-election this year.

One concern shared by Mr. Rockefeller and privacy advocates is predatory marketing activity conducted by financial firms or other companies using data from brokers to target vulnerable groups such as the impoverished or immigrant populations. Another is the practice of scoring individuals determined by algorithmic data analysis and serving them with tailored offers. In some cases, argue privacy advocates, that could involve higher interest rates for loans or dynamic prices for products based on prior web behavior or demographic data.

In September Acxiom launched a site allowing people to access bits of information the firm stores on them, and make corrections if they wanted. The AboutTheData site shows data the firm might sell or use to enhance corporate client information to create target-able customer segments, such as age, estimated income, residence, ethnicity, marital status and categories of product purchases.

Some found much of the data therein incorrect, lending nuance to ongoing discussions about personal privacy in an age of data-centric marketing.

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