The Consumer Financial Protection Bureau (CFPB) is hoping to protect the sensitive data of millions of consumers by changing what data brokers can sell.
The rule will see data brokers change status to “consumer reporting agencies” if they sell information about consumers’ income, credit history, credit score, or debt payments.
The move aim to stem the flow of sensitive data getting into the hands of cybercriminals, since this data is not just coming from the thousands of data breaches that happen each year.
What Is the Proposed Rule?
The rule will see data brokers change status to be treated “like credit bureaus and background check companies,” says The Verge. This means that they will have to comply with the Fair Credit Reporting Act (FCRA) and its restrictions on how they obtain information – for example, the data provided in consumer reports.
The rule also changes the consent levels for consumers.
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To comply with the FCRA, data brokers will have to get clear consent for data sharing and also permission to sell sensitive personal or financial information from consumers.
How Could the Rule Help Consumers?
The rule, which is aimed at private companies, gives consumers more control over their data. The CFPB also hopes it might stop some data from getting into the wrong hands.
CFPB director Rohit Chopra talked about the massive National Public Data breach that happened in October in which 200 million Social Security numbers were leaked and then offered for sale on the dark web. “These aren’t just isolated incidents: they represent a systemic vulnerability in how our personal data is bought and sold,” Chopra said in a press call.
Chopra added: “Data brokers – the outfits that collect and sell detailed information about our personal and financial lives – are making this data available to anyone willing to pay a price.”
This includes hostile foreign nations. “By selling our most sensitive personal data without our knowledge or consent, data brokers can profit by enabling scamming, stalking, and spying,” he added.
What Are the Next Steps?
Well, this rule might actually never come into being. The CFPB is accepting comments on the proposed rule until March 3, 2025. However, according to the Washington Post, Trump and company are already eyeing up the CFPB and could limit its powers and funding, accusing it of regulatory overreach. This proposed rule might stay a proposal.
A CFPB spokesperson wouldn’t comment on “what a future administration may do” but said that there was “broad bipartisan recognition that data brokers pose real dangers both to Americans’ privacy and to national security.”
