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Privacy Bill Would Give Real Power to FTC, Prison Land Managers

  Men in suits talking in microphones.
Enlarge / Senator Ron Widen interrogates witnesses during a hearing at the Senate Committee on Intelligence on the impact of social media on the 2016 election in Washington, DC, in November. 1, 2017.

Sep. Ron Widen (D-Ore.) Would like technology and data companies to consider their own businesses and take their noses out of yours. To that end, he tabled a bill that would have penalized them, possibly with a jail term for CEOs, for not doing so.

The proposed bill (PDF), actually called "Learn Your Own Business Act of 201

9," is in many ways an updated version of the Wyden discussion project, published last November.

The project does not specifically identify any companies, but focuses on general concepts of personal data and company responsibility. However, Widen indicated the names in a statement, and Facebook is clearly outlined and focused on its radar.

"Mark Zuckerberg will not take the privacy of Americans seriously unless he feels personal consequences," Widen said. "FTC striking the wrist won't work, so in my opinion it would go to jail for lying to the government."

Not only do companies have to be more transparent and give more users control, Widen added, but "corporate managers also have to take personal responsibility when they lie to protect our personal information."

The proposal poses several major challenges. First, users are tracked and monetized, but they have no effective way of controlling that tracking or even knowing what was done with the data they collect. Secondly, businesses that siphon and trade in consumer data have terrible results when it comes to securing that data and preventing unauthorized access. And third: the Federal Trade Commission, which is the closest thing we have to the data protection regulator, is terribly inadequate and lacks the resources to deal with the challenge.

Sen. The Widen bill will address these concerns by 1) imposing minimum standards for the confidentiality and security of user data, 2) increasing the transparency of users to access their own data and learn what is done with them, 3) creating severe penalties for companies that 4) expand the FTC's powers and resources so that it can impose such penalties. The bill would allow companies to charge for higher-confidential versions of services, but would exempt from those fees anyone using a Lifeline⁠ subsidy (a small loan that individuals and low-income families can use to pay telephone or broadband services) ⁠, This would be a gesture against maintaining privacy as a luxury item.

Putting Somebody in Rhythm

The FTC has recently set up a small department dedicated to technology issues, but Widen's proposal will improve it significantly.

FTC Chairman Joseph Simmons has said several times this year that he believes his agency is hampered by his inability to impose strict penalties for first time violations of the FTC Act or the Safeguards Rule, which requires financial institutions to take care specifically for consumer data.

"The CFPB and states have been able to obtain civil penalties for this massive breach by a large financial institution. The FTC could not," Simons told a news conference in July, explaining the agency's settlement with Equifax. "Fortunately, other agencies have been able to fill the void this time.

A few days later, when we were discussing the $ 5 billion agreement between the FTC and Facebook, Simons again called on Congress for a new bill. "We are a law enforcement agency without the authority to promulgate general confidentiality provisions," Simmons said at the time. "Our authority in this case comes from a 100-year charter that was never intended to address privacy issues like the ones we address today."

If Sen. Widen's bill were to become law, the FTC would hire 175 additional employees to help enforce data and confidentiality standards – and sanctions could be severe. A first offense that currently does not carry a fine would cost the company up to 4% of its annual revenue. In the event of a breach of Equifax data, for example, this would represent an additional $ 136 million for the FTC, in addition to the existing $ 500 million agreement.

Corporate employees would also be held liable for the behavior of their company. If a business, such as Facebook or Google, is found to be reporting inaccurate privacy reports, executives will be fined 5% "of the maximum annual compensation received in the previous 3-year period," or 1 a million dollars, which is up to 10 years in prison.

This is for oops only. If these officers were found to have deliberately lied to these reports, the penalties would jump to 25% of the compensation or $ 5 million, whichever is greater, and up to 20 years in prison.

The Challenge

Almost everyone with the Colleagues on the subject, including politicians from the two major parties, agree that we in the United States are badly late for some kind of updating of the law and privacy regulation. The issues of what such a law should cover, what it should allow, and who should benefit from it are, however, controversial at best.

More than 50 of the country's largest companies – including Amazon, AT&T and Comcast, among dozens of others – signed a letter (PDF) to Congress in September requesting federal privacy legislation.

Companies wrote:

We are committed to protecting consumer confidentiality and we want consumers to trust that companies treat their personal information responsibly. .. We are also united in our belief that consumers should have meaningful rights to their personal information and that companies that have access to this information should be kept under constant accountability under the entire federal Consumer Data Privacy Act. .

The Foundation for Electronic Borders and Other Critics called the corporate campaign "unwavering", saying it was an "effort to undermine real progress in privacy" made nationwide.

The poster child for these state efforts is the California Consumer Privacy Act, which comes into force after less than three months on January 1. California's high population and influence as a technology hub in the past have effectively caused its privacy regulations to become de facto national standards, and companies that rely on the ability to collect, remix and use consumer data are not fascinated by the idea. They are also unlikely to like Widen's federal proposal, since it does not explicitly encourage states to set their own, more stringent guidelines.

Beyond the issue of corporate money and corporate preferences, however, the biggest challenge to achieving anything through Congress this decade is Congress. Shrewd observers may have noticed that the political process in Washington DC is somehow harmonious these days. Not only is there a significant party divide to oppose, but in the immediate sense, both chambers are busy with questions such as "Can we withhold this government's funding in November, please?" And "Are we imprisoning the president?" [19659004] With that said, the Widen bill could easily become a pattern to which he and other senators return in future sessions of Congress when the conditions for making the actual law may become more favorable.

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