The Federal Trade Commission (FTC) has issued a prohibition against data brokers X-Mode Social and Outlogic, barring them from selling sensitive location data. The two companies have been accused of failing to obtain consumer consent or adequately inform consumers about their data collection practices.
In a press release by the FTC, it was revealed that the companies were involved in selling sensitive location data on unsuspecting consumers. This information could be used to track specific locations visited by individuals, potentially revealing highly sensitive details such as visits to medical clinics or domestic abuse shelters. The FTC stated that the companies failed to implement safeguards that would restrict the unethical use of this data by third-party purchasers.
The FTC press release further explained that the raw location data was sourced through mobile advertising IDs, a method which does not anonymize the collected data. The sold data was gathered from third-party apps and purchased from other brokers. These companies then resold the consumer location data to hundreds of clients across various industries. Additionally, they did not inform users of their apps about the tracking of consumer information or clarify how the collected data would be utilized. As part of its ruling, the FTC is ordering both companies to delete all previously collected location data obtained without consumer consent and establish a supplier assessment program. This program will ensure that any data provided to X-Mode or Outlogic is acquired with explicit consent from consumers.
FTC Chair Lina M. Khan said, "Geolocation data can reveal not just where a person lives and whom they spend time with but also, for example, which medical treatments they seek and where they worship." She continued by stating that "the FTC’s action against X-Mode makes clear that businesses do not have free license to market and sell Americans’ sensitive location data." Khan emphasized that "by securing a first-ever ban on the use and sale of sensitive location data, the FTC is continuing its critical work to protect Americans from intrusive data brokers and unchecked corporate surveillance."
