The Consumer Financial Protection Bureau launched a broad inquiry into the market for consumer financial data, seeking information on how data brokers collect information with an eye toward potential new rules.
The information the CFPB is collecting from data brokers, financial institutions, individual consumers and other market participants will be used in bureau efforts to police the market, including “planned rulemaking” under the Fair Credit Reporting Act, the CFPB said in a Wednesday announcement.
Data brokers collect, sell, aggregate, resell and license information about consumers that can be used to craft credit reports and screening for potential job and housing applicants. In some instances, data brokers create consumer profiles that can be bought and sold.
Consumer advocates have raised concerns about the way data brokers collect information and how it’s used, as well as the inability of most people to opt out of that collection.
“Modern data surveillance practices have allowed companies to hover over our digital lives and monetize our most sensitive data,” CFPB Director Rohit Chopra said in a statement.
Chopra added that the CFPB will use the information it gathers to determine what updates need to be made to the FCRA, a 1970 law governing credit reporting and other consumer data issues.
The CFPB wants to know where data brokers collect information and how brokers use that data. The request for information also seeks to find out how much data brokers rely on publicly available sources of information and how much they purchase, as well as any restrictions financial institutions may put on the brokers’ use of data.
The CFPB also asks which companies and other entities purchase data from brokers and for what purposes, as well as how consumers can opt out.
Comments to the CFPB are due on June 13.
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