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Online Privacy: CU encourages stronger standards

Monday, May 24, 2010

Online Privacy: Consumers Union Encourages Stronger Standards in House Bill

Washington, D.C. — Consumers Union (CU), the nonprofit publisher of Consumer Reports magazine, today sent a letter to the House Energy and Commerce Subcommittee on Communications, Technology and the Internet about the discussion draft of a bill to establish online privacy standards. The organization said the draft contained some helpful provisions, but recommended changes to make the legislation stronger.
In the letter to Subcommittee Chairman Rick Boucher and Ranking Member Cliff Stearns, CU said it said it supported the draft’s requirement that online entities such as Facebook obtain notice and express consent for any material changes in privacy practices for previously collected information. Ellen Bloom, CU’s Director of Federal Policy and the Washington D.C. Office, Joel Kelsey, CU Policy Analyst, and Ioana Rusu, CU Staff Policy Assistant, wrote: “Consumers should be able to rely on companies’ privacy policies without constantly worrying that these policies will change arbitrarily, without notice.”
The advocates pointed to consumers’ frustration with Facebook’s recent decision to provide user preferences to third-party partners by default, stating: “Individuals should be required to give affirmative consent before their information is shared for commercial targeting purposes.”
Consumers Union recently released its annual “State of the Net” survey that determined 16 percent of Internet users had experienced some form of identity theft related to use of the Internet, and as many as 29 percent had experienced a spyware infection within the past year. The survey also revealed that 31 percent of consumers using the Twitter service had taken no measures to protect their privacy.
CU said the draft bill’s definitions of what constitutes “covered information” and “sensitive information” would help federal regulators set meaningful guidelines, but advocates urged lawmakers to make the language flexible enough for regulators to add to these definitions as new technologies arose and evolved.
While CU said the bill was an important step in the online privacy debate, the organization raised concerns about the bill’s reliance on the “notice and choice” model, which CU said “has been shown to be particularly ineffective in protecting consumer privacy online.”
CU also said it was “extremely concerned” that the bill would create a significant loophole for entities selling information to third parties, saying the minimal requirements in the proposal would “permit an enormous percentage of data sale transactions to escape coverage.” The organization faulted the bill’s specific elimination of any private right of action against those that violated the law. Advocates emphasized the importance of preserving the states’ ability to continue developing new privacy protections, and urged lawmakers to construct the federal preemption language as narrowly as possible.
The full letter is online here. CU’s 2010 “State of the Net” survery is available here.
Media contact:
David Butler or Kristina Edmunson, 202-462-6262
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