CFPB Seeks Information on Data Broker Practices

The CFPB is seeking comment on the business practices of data brokers and the collection and sale of consumer information.

In a Request for Information ("RFI"), the CFPB drew attention to an increase in abuses concerning the sharing of consumers' private data by data brokers. The agency said the level of abuse corresponds to the growth of the internet and the advent of new technology. The CFPB said it is seeking additional detail about the types of data that brokers collect and sell and the sources they rely upon.

The CFPB requested market-level information on, among other things: (i) the data provided by financial institutions and the opportunities given to opt out of data sharing; (ii) the "granular" nature of the data broker's collection of information related to consumer preferences; (iii) how data companies create, build or refine proprietary algorithms for the data, (iv) how data broker activities encourage or limit market competition, (v) whether certain populations are limited in their access to control data sharing; (vi) how and when data is "anonymized"; (vii) whether consumers can avoid having their data collected and (viii) what information is collected by state-level data broker registries.

As to individuals, the CFPB requested information on (i) the harms or benefits consumers have experienced, (ii) whether certain consumer harms are tied to specific data brokers, (iii) what consumers experience when attempting to remove data sharing options, and (iv) the number of consumers that have tried to access or correct their private data.

The RFI will be published in the Federal Register, and the public will have until June 13, 2023 to submit comments.