Karl Herchenroeder

Sens. Rob Portman, R-Ohio, and Tom Carper, D-Del., are developing legislative proposals on data security and privacy and want to collaborate with the Senate Commerce Committee, Portman and Carper said Thursday. Thursday’s Senate Investigations Subcommittee hearing should help refine data security legislation, Portman told reporters. Earlier, he questioned Equifax, Marriott and the FTC’s Consumer Protection Bureau chief.

Racial discrimination concerns “absolutely” need to be addressed in the data privacy debate, House Consumer Protection Subcommittee Chair Jan Schakowsky, D-Ill., told reporters after a hearing Wednesday. The tech industry should ensure that facial recognition and other technologies aren’t discriminating against minorities, she said.

The Senate Commerce Committee bipartisan working group’s goal is to negotiate privacy legislation differences “in the next month,” Sen. Jerry Moran, R-Kan., told us Tuesday. The group includes Moran, Commerce Chairman Roger Wicker, R-Miss., Sen. Richard Blumenthal, D-Conn., and Sen. Brian Schatz, D-Hawaii. Staffers for the lawmakers are exploring privacy principles and specific legislative provisions, Moran, Schatz and Blumenthal told us. “There is no deadline, but I am encouraging, pushing that this be addressed, that we get to the point at which the senators can sit down and try to resolve any additional, remaining differences in the next month,” Moran said. The group is in more advanced discussions than “principles,” Wicker told us. It hasn’t reached the point where draft legislation is circulating, Blumenthal told us. Staff is weighing principles and “specific provisions,” he said, noting draft legislation can’t be written with principles. “There’s no deadline. We want to get it right,” Blumenthal told us. “We have to make it bipartisan. We have to get the Republican leadership.” Wicker was asked whether he has a privacy hearing in mind for April. “I don’t know that we’ve scheduled that, but we’re going to have lots more witnesses on data privacy,” he told reporters. The committee received criticism from privacy and consumer groups when an initial list for its first privacy hearing of the year featured an all-industry panel (see 1902220041).

Antitrust law isn't a “Swiss Army knife,” capable of solving a host of social ills like privacy concerns, Senate Antitrust Subcommittee Chairman Mike Lee, R-Utah, said Tuesday during a hearing on monopolies. But ranking member Amy Klobuchar, D-Minn., said the increase in ownership concentration, particularly with tech, is leading to stagnating wages and other consumer harms.

Removing liability protections from Section 230 of the Communications Decency Act results in heavier content moderation, evidenced by impacts of a new anti-sex trafficking law (see 1806290044), Facebook Public Policy Manager Lori Moylan said at the Cato Institute Friday. Moylan said it’s likely some Conservative Political Action Conference attendees might argue that without Section 230 protections, Facebook “would no longer accidentally take down any conservative political speech,” which is “simply not true.”

Breaking up big tech platforms like Facebook could “very potentially” help with political censorship issues related to anti-competitive behavior, Sen. Ted Cruz, R-Texas, told us, responding to questions about the FTC’s newly formed tech competition task force (see 1902270063). Facebook’s acquisitions of Instagram and WhatsApp are an “obvious place to inquire,” said Cruz, the agency’s Office of Policy Planning director in the early 2000s. “I hope the task force looks at both antitrust issues and consumer protection issues and in particular, the political censorship that we’ve seen from big tech.” He called the group “long overdue.”

Owners of musical.ly, a video social networking app now called TikTok, reached a record $5.7 million settlement with the FTC over claims the company illegally collected children’s personal data, the agency announced Wednesday. It’s the largest civil penalty the FTC, whose members unanimously approved, has collected under the Children’s Online Privacy Protection Act. Musical.ly failed to seek parental consent for collecting names, email addresses and other data from users younger than 13, the FTC alleged in a complaint filed by DOJ. “We take enforcement of COPPA very seriously, and we will not tolerate companies that flagrantly ignore the law,” Chairman Joe Simons said in a statement. “These practices reflected the company’s willingness to pursue growth even at the expense of endangering children,” said Commissioners Rohit Chopra and Rebecca Kelly Slaughter. They said executives should face more accountability in future cases. The company has implemented changes that now direct TikTok users into “age-appropriate” app sections, it said: “The new environment for younger users does not permit the sharing of personal information, and it puts extensive limitations on content and user interaction.” Sen. Ed Markey, D-Mass., urged future “higher monetary penalties that will actually [incentivize] COPPA compliance.” More than 200 million worldwide users, 65 million registered in the U.S., downloaded the app. Accounts were publicly available by default, the FTC said, and public reports show adults contacted children through the app. The app includes a feature that lets users discover other users within a 50-mile radius. App operators received thousands of complaints from parents that their underage children had accounts, the FTC said. “This case should put tech companies on notice that continued disregard for COPPA will result in penalties and consumer mistrust that can seriously impact their business,” said Common Sense Media CEO Jim Steyer.

Senate Commerce Committee Chairman Roger Wicker, R-Miss., ranking member Maria Cantwell, D-Wash., and industry officials are open to passing a federal privacy law that’s stronger than California’s. Cantwell suggested during the committee’s first privacy hearing in 2019 that federal law should be stronger, at a minimum. Wicker sounded hopeful about prospects for privacy legislation during a later Incompas event, saying it's one of his “must-pass” priorities for the committee this year (see 1902270018).

The U.S. credit reporting system needs to be overhauled, House Financial Services Committee Chairman Maxine Waters, D-Calif., and ranking member Patrick McHenry, R-N.C., agreed during a hearing Tuesday. Waters suggested the U.S. might need to completely rebuild the credit reporting industry to “put consumers first.” She urged support for her Comprehensive Consumer Credit Reform Act, which amends the Fair Credit Reporting Act, revising requirements for disputes over consumer credit information reported by consumer reporting agencies. McHenry said the credit reporting system is broken. The Fair Credit Reporting Act, which governs the industry, was written for the pre-internet era, he said. The three companies testifying are an oligopoly, he said. Equifax CEO Mark Begor expressed regret about the 2017 cyber breach (see 1809070053). Since the incident, the company has invested more than $80 million to assist affected consumers, including a free identity theft protection service that expires in November, he said. Experian North America CEO Craig Boundy said his company supports a federal data security and breach notification standard. TransUnion CEO James Peck committed to working with the committee, regulators and industry to make credit reporting “stronger, fairer and more accurate.”

It makes no sense for Republicans to support a privacy bill that doesn’t pre-empt state law, House Commerce Committee ranking member Greg Walden, R-Ore., told us before the committee’s first 2019 privacy hearing. “We should look at what’s best for the country. Maybe it is California’s law. I don’t think so personally, but we should get schooled up on” state laws, he said.