Data crackdown in the US starts; Personal data with Facebook, Google, others under spotlight

The Federal Trade Commission is seeking public feedback on a proposed rulemaking to limit what it’s dubbed “commercial surveillance” by businesses that sell or share information collected about people, with the potential to bring fines against them for first-time violations of data-protection obligations.

The planned rules, kickstarted with a notice Thursday, would protect personal data companies such as Alphabet Inc. (Google) and Meta Platforms Inc. (Facebook) collect about consumers.

Consumer groups have been pressing the FTC to begin the likely years-long process of putting out regulations to govern consumer data that’s used for targeted advertising. Attention is turning to the agency as lawmakers in Congress make progress toward a bipartisan privacy law proposal but remain divided on enforcement and other key issues.

Typically the FTC is only able to fine companies like Meta that have breached past privacy agreements with the agency. That would change if the commission’s proposal becomes final, allowing the agency to seek penalties for first-time violations.

The Democrat-led commission voted 3-2 to issue the rulemaking notice, with its two Republican members voting against the action.

The commission is concerned about businesses that track consumer behavior across websites and apps to deliver personalized ads to them, according to the rulemaking notice. Without standards for data security, aggregating troves of information about people exposes them to hackers and identity thieves, the notice says.

The FTC also is interested in overseeing data-driven algorithms to make sure they don’t unlawfully discriminate against consumers. Civil rights advocates have raised issues over potential racial or gender bias in which audiences see housing ads online and which job candidates are favored by automated hiring software.