A Review of the Data Broker Industry: Collection, Use, and Sale of Consumer Data for Marketing Purposes

December 18, 2013

WASHINGTON, D.C.— Ahead of a Senate Commerce Committee hearing on how data broker industry practices may impact consumers, Chairman John D. (Jay) Rockefeller IV released a majority staff report summarizing the Commerce Committee’s investigation into how data brokers collect, compile, and sell consumer information. In spite of the key role they play in determining what advertisements and offers consumers receive, data brokers remain largely invisible to the consumers whose data populate their databases.

The Committee majority staff report finds that:

  • Data brokers collect a huge volume of detailed information on hundreds of millions of consumers, including financial, health, and other personal information; consumers have little or no awareness of these activities;

  • Data brokers then use this consumer information to create marketing products that group consumers in categories, some of which focus on consumers’ financial vulnerability;

  • Data brokers create products for use in online targeted marketing that are based on offline dossiers collected by the companies; and

  • Data brokers operate behind a veil of secrecy, subject to limited statutory consumer protections, and some perpetuate this secrecy by limiting customers from disclosing their data sources.

Rockefeller launched the inquiry in October 2012 to help the Committee better understand data broker industry practices and the information data brokers collect and share about American consumers for marketing purposes. The Committee is holding a hearing at 2:30 p.m. today titled, “What Information Do Data Brokers Have on Consumers and How Do They Use It?” to examine these issues. The hearing will be webcast live via the Senate Commerce Committee website.

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