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FTC

FTC Forum Hears Evidence that U.S. Should Follow European Union Privacy Model

The agency is proposing to use its own authority to regulate tech platforms for their ‘commercial surveillance’.

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Photo of Digital Content Next CEO Jason Kint from C-SPAN

WASHINGTON September 15, 2022 – The Federal Trade Commission should consider adopting standards established by the European Union’s General Data Protection Regulation to force Big Tech platforms to consent to the use of their user’s personal information, according to the CEO of a digital content trade organization.

The FTC proposed last month to use its authority under Section 18 of the FTC Act to bring “commercial surveillance” – the act of entities collecting personal information and selling them to third-party data brokers – under its authority to further regulate technology platforms. Section 18 is a statute of the FTC Act that grants the commission the authority to implement trade regulation rules for businesses that use tactics that are considered “unfair” or harmful to consumers.

Digital Content Next CEO Jason Kint said during an FTC public hearing on the matter on September 8 that the EU’s GDPR model provides an established practice of requiring companies and organizations to get consent to the use of their data in these contexts.

“Having a pop-up come up [for consent] every time you visit the site…that’s entirely in line with users’ expectations,” Kint said. To comply with GDPR principles, websites shown to users in the United States must ask visitors if they consent to the collection of their data in part to cater certain products to them.

“The user doesn’t want it to happen where their data is being tracked by third parties,” Kint said.

“So, if you’re the party that they’re choosing to interact with for service, providing them that data is very different.”

In August, the FTC announced an rulemaking to consider commercial surveillance as a Section 18 violation of the FTC Act. It its notice seeking comment, the FTC asked questions about what companies should disclose, who would administer the disclosure agreements, and if the FTC should impose limitations on the mechanisms companies use to hide their surveillance practices.

On July 20, the Senate Commerce Committee passed comprehensive privacy legislation a restricting collection and transfer of personal data of U.S. citizens without consent.

The measure has not yet passed the House, but in responding to the August announcement, Energy and Commerce Committee Chairman Frank Pallone, D-N.J., said that it is the responsibility of Congress, not the FTC, “to pass comprehensive federal privacy legislation.”

There are currently more than 120,000 comments on this issue. The FTC is still collecting public statements on this issue until October 21.

Reporter Zoey Howell-Brown studied at Coppin State University and Node Center for Curatorial Practices. Her work has appeared in The Real News Network, The Odyssey, Terse Magazine and Broadband.Money. When she’s not reporting on telecom news, you can find her at the latest exhibition opening, film festival, or on LinkedIn.

FTC

Epic Games Settles with FTC for $520 Million

Epic’s $275 million penalty for alleged COPPA violation is the largest to date, according to the agency.

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Photo of Sen. Maria Cantwell, D-Wash., cropped, in July 2017 by Senate Democrats used with permission

WASHINGTON, December 19, 2022 – The Federal Trade Commission and Epic Games, creator of the popular video game Fortnite, have reached a pair of settlements, totaling $520 million, to resolve allegations that the developer violated the data privacy of child users and deceptively pushed in-app purchases, the agency announced Monday.

The FTC alleges that Epic violated the Children’s Online Privacy Protection Act by collecting the personal data of players under 13 years of age without properly notifying their parents or obtaining parental consent. In addition, the watchdog says children’s game settings by default allowed voice and text communication with other players, exposing them to harm.

“Children and teens have been bullied, threatened, harassed, and exposed to dangerous and psychologically traumatizing issues such as suicide while on Fortnite,” the FTC said.

Epic agreed to pay a $275 million penalty for its alleged COPPA violation, which is the largest penalty for breaking an FTC rule imposed to date, according to the agency. Epic agreed to the second penalty, $245 million, to resolve allegations that it manipulated users into purchasing in-game content through a confusing interface.

“Statutes written decades ago don’t specify how gaming ecosystems should operate. The laws have not changed, but their application has evolved and long-standing industry practices are no longer enough,” Epic said in an online post. “We accepted this agreement because we want Epic to be at the forefront of consumer protection and provide the best experience for our players.”

As a part of the settlements, Epic neither admitted nor denied the claims made against it.

The settlements immediately drew praise: “The FTC’s lawsuit against Epic proves we need stronger online privacy protections for children and teens,” said Sen. Maria Cantwell, D-Wash., in statement Monday. “Kids were bullied, harassed, and threated because Epic designed its games to let them communicate with strangers from all over the world. It’s time for Congress to step up for kids and protect them from online harms and to make sure we have a stronger FTC to enforce against bad actors.”

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Antitrust

Republican FTC Commissioner Criticizes Biden Economic Officials as Detrimental to Agency

Commissioner Christine Wilson attributes poor results of FTC staff satisfaction surveys to the officials’ leadership.

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Photo of Christine Wilson, Randolph May, Noah Phillips and Maureen Ohlhausen

WASHINGTON, May 9, 2022 – On Friday Republican commissioner of the Federal Trade Commission Christine Wilson expanded upon released remarks criticizing the leadership of economic officials chosen by President Joe Biden as detrimental to the functioning of her agency and staff.

Wilson pointed to recently administered surveys of FTC staff on satisfaction in their jobs which showed historically poor results for the commission, saying attitudes towards the commission and its work peddled by its Chair Lina Khan, former commissioner and current director of the Consumer Financial Protection Bureau Rohit Chopra and Biden’s special assistant for technology and competition policy Tim Wu are largely to blame for low staff morale.

“We saw Chair Khan’s arrival and a complete disregard for the rule of law and due process, not to mention complete disregard for staff,” said Wilson.

“We saw Commissioner Rohit Chopra arrive at the FTC and begin excoriating the agency and the commission and the staff as being lax and feckless for the last 40 years.”

Speaking at the Free State Foundation’s Annual Policy Conference with fellow Republican Commissioner Noah Phillips and former Republican chairwoman of the commission Maureen Ohlhausen, Wilson cast the commission as an entity in disarray.

She revealed a workplace where commissioners have often been given very little notice on items they will be considering on the agenda of the commission.

Ohlhausen noted a decrease in bipartisan activity from the commission that she felt was present as a long-lasting legacy of commissions past during her tenure as chair, and Wilson described “disdain and marginalization of staff by current leadership” as harmful to the environment at the commission.

Drawing on her recent remarks, Wilson hypothesized that new leadership’s economic worldview draws heavily on concepts from academic Marxism and critical legal studies, a school of thought of which the Republican-maligned critical race theory is an offshoot.

She states that these theories largely play into the view of new leadership that the FTC in the past has not brought nearly enough action to protect consumers.

Also on Friday, Wilson emphasized the need for federal privacy legislation and said she has heard of a “concerted push” in Congress for such legislation to pass soon.

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FTC

Biden Looks to Bedoya to Replace Rohit Chopra on FTC, Report Says

Staunch privacy advocate Alvaro Bedoya appears to be Joe Biden’s pick for the FTC, Axios reports.

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Staunch privacy advocate Alvaro Bedoya appears to be Joe Biden's pick for the FTC

WASHINGTON, September 13, 2021—President Joe Biden is expected to bring on privacy stalwart Alvaro Bedoya for the open seat on the Federal Trade Commission, according to reporting from Axios.

Born in Peru and raised in New York, Bedoya attended Harvard University where he received his B.A. in Social Studies. He also holds a J.D. from Yale.

A longtime supporter of consumer privacy rights, Bedoya is the founding director of the Center on Privacy and Technology at Georgetown Law. Previously, he served as chief counsel of the Senate Judiciary Subcommittee on Privacy, Technology, and the Law. While working in the Senate, much of his work centered on location and biometric privacy with regard to consumer protections.

As it stands now, there are three Democrats and two Republicans on the commission. In January of 2021, Biden tapped Rohit Chopra to serve as the Director of the Consumer Protection Bureau. Though Chopra’s term on the FTC expired in 2019, the commission allows incumbent members to sit until a replacement is appointed—in this case, Bedoya.

The Washington Post quoted Republican FTC commissioner Noah Phillips speaking fondly of Bedoya. “I don’t think of him as a person who just gets up and rants about entities he doesn’t like,” and described him as “without fail as bright and thoughtful a person as you could find.”

Phillips has been broadly critical of the direction he feels the FTC is going and has historically criticized political firebrands on both sides of the aisle.

As Big Tech faces mounting criticism from both Republicans and Democrats with regard to privacy, misinformation, and alleged censorship, Bedoya will be entering a tumultuous era for the FTC.

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