Data Sellers Claim They Want To Be Regulated

from the yeah.--right. dept

In what must be an attempt at saving some level of credibility, the chief executives of both ChoicePoint and LexisNexis are saying they would support a federal law mandating disclosure, if someone’s private data was exposed. It all sounds good, considering these two firms were both recently caught exposing info, whether by selling it to identity thieves or just letting them sneak in and take the data. However, if they really believed this, wouldn’t they have just done what such a law would mandate and tell people their data had been exposed? Why would they need a law to do that if they already agree it’s the right thing to do? The answer is because they don’t really think it’s the right thing to do, as evidenced by the fact that they didn’t do it in the past when they had exposed data. They’re just saying this to Congress because they don’t know what else to say at this point.

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Comments on “Data Sellers Claim They Want To Be Regulated”

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gp says:

No Subject Given

They need a law because 1) they cannot afford to be disclosing mistakes to the marketplace when competitors may not be doing so voluntarily and 2) and most importantly, the cost of compliance is something THEY can afford as large existing players but it raises entry barriers for small potential competitors.
Large players want government regulation because they alone can afford to comply with it. (credit to Prof. Theodore Lowi for the concept many years ago)

Matt Brubeck (user link) says:


There’s a good reason these companies might support regulation.

Without regulation (or other incentives, like liability), a company that spent more than necessary on disclosure would place itself at a disadvantage; it couldn’t compete on a level playing field with companies that don’t bother with unnecessary disclosure. The unscrupulous companies would end up taking business from the scrupulous ones, and the public would lose out.

With regulation, a company like ChoicePoint can make the sacrifices involved in full disclosure, knowing that their competitors are facing the same burdens.

Beck says:

No Subject Given

I agree with the above two, and I think there is another reason they might want regulation, and that’s liability.

If there are regulations, then a lawsuit defense would be to document how they comply with all federal regulations. Without the regulations, no matter what they do, a lawsuit can claim that they should have done something more.

LBB says:

It's a pre-emptive strike

The data companies are dangling the “required notification in cases of compromise” carrot in front of Congress in order to head off any talk of actually letting the consumers control their own personal data.
Notice all the talk in the article is about “monetizing” the information and making it available “for important purposes, including fraud detection and prevention, law enforcement.” Nothing is said about empowering us to protect our own data (by removing it from the warehousing companies, placing strictures on its use, etc.)

knight37 (user link) says:

Re: It's a pre-emptive strike

Precisely. This is the problem with these large warehouses. The people who have data in them a) may not even be aware of it, 2) have no control over what is put in there, 3) don’t even have access to be able to look at it, and 4) are unable to correct incorrect data even when it is provable that the information is false. Furthermore, the type of data that is being put in there isn’t even factual in some cases, it’s based on false information to begin with. This is a rediculous situation.

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