January 26, 2006- Largest Fine Ever Levied By FTC Leaves Large Hole In Our Privacy Laws

WASHINGTON, DC – As the Federal Trade Commission announced a $15 million settlement with data broker ChoicePoint for data breaches which took place in 2005, Representative Edward J. Markey (D-MA), a member of the House Subcommittee on Trade and Consumer Protection renewed his call for Congress to pass legislation to close down the loophole that permits ChoicePoint and other data brokers to jeopardize the privacy of millions of Americans by transmitting and selling personal data without proper safeguards.

“While I am pleased that the Federal Trade Commission has levied the largest fine in the agency’s history against ChoicePoint for egregious violations of consumer privacy, I remain concerned that almost a year after revelations of data security breaches at ChoicePoint, Congress still has not provided Americans with what they urgently need – tough privacy safeguards to keep their personal information secure,” said Rep. Markey, author of H.R.1080 the “Information Privacy and Security Act” And H.R. 1078, the “Social Security Number Protection Act.”  

Today the FTC determined that ChoicePoint handled Americans’ most precious personal data in a cavalier and careless manner, handing over the highest fines on record.  ChoicePoint came under national scrutiny for jeopardizing the safety of the personal financial records of more than 163,000 consumers.  Since the widely publicized ChoicePoint breaches, more than 52 million Americans have had their personal information compromised by breaches of privacy at other companies, universities and government agencies. 

“ChoicePoint became the poster child for lax privacy practices, but we now know that the privacy problem goes far beyond just one company.  In the year since the ChoicePoint debacle millions more Americans have become victims of a data breach – underscoring the need for new legislation to better protect consumers against business activities which leave their privacy at risk.  In the weeks to come, Congress will continue to consider legislation to close gaping privacy loopholes that were first exposed by the ChoicePoint data thefts.  Congress must pass legislation that includes strong privacy safeguards and enforcement tools that lock data thieves out of files containing Americans’ Social Security numbers, financial accounts information and other personal information,” said Rep. Markey.  “Data brokers, who view our Social Security numbers, mortgage balances and other private information as commodities to be bought and sold for a profit, should take note of today’s FTC settlement.  I am hopeful that the settlement also will generate momentum for federal legislation that delivers the robust privacy protections that are required to protect consumers’ private information from prying eyes.” 

Rep. Markey is the sponsor H.R. 1080, the “Information Protection and Security Act which would subject information brokers like ChoicePoint to federal regulation by the Federal Trade Commission, and require that such brokers comply with a set of new fair information practice rules and H.R. 1078, the “Social Security Number Protection Act,” which would bring a halt to unregulated commerce in Social Security numbers and make it crime for a person to sell or purchase Social Security numbers. 

For more information on Representative Markey’s bills to prevent further consumer privacy breaches check out: http://www.markey.house.gov/ or the links below.

January 26, 2006


CONTACT: Tara McGuiness
Mark Bayer