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Direct Response Marketing

Senator, DMA Spar Over Data Brokers Probe

17 Oct, 2012 By: Doug McPherson


WASHINGTON – When Senator John D. Rockefeller IV (D-WV) announced last week that he had opened an extensive investigation of nine well-known information brokers, it didn’t take long for the fur to fly. The New York Times reported that Linda A. Woolley, the acting chief executive of the Direct Marketing Association (DMA), wasted little time shooting off an E-mail to the senator calling probe “a baseless fishing expedition.”

“I hope Sen. Rockefeller understands what he’s tampering with,” Woolley wrote.
As chairman of the U.S. Senate Commerce Committee, Rockefeller is seeking detailed information on the practices of data brokers that compile and sell information about consumers.

It’s the second congressional inquiry into data brokers this year. In July, Rep. Edward Markey (D- MA) and Rep. Joe L. Barton (R-TX), co-chairmen of the Bipartisan Congressional Privacy Caucus, opened a House inquiry into data compilers. Plus, the Federal Trade Commission (FTC) has been looking into the practices of about a dozen major data brokers.

Rockefeller said of his probe that the breadth and reach of data brokers – particularly with the growth of the Internet – requires a better understanding of their practices and the impact they have on consumers.

“Collecting, storing and selling information about Americans raises all types of questions that require careful scrutiny,” Rockefeller said. “While these practices may offer some benefits to consumers, they deserve to know what’s being collected about them and how companies profit from their information. We are sending letters to nine different companies today to learn how this industry works.”

Rockefeller sent the letters to:

  • Acxiom
  • Experian
  • Equifax
  • Transunion
  • Epsilon
  • Reed Elsevier (Lexis-Nexis)
  • Datalogix
  • Rapleaf
  • Spokeo

Rockefeller wants the companies to respond by Nov. 2, and he asked each to share extensive business details about data collection operations since Jan. 1, 2009. In the letter, he wrote, “An ever-increasing percentage of their lives will be available for download, and the digital footprint they will inevitably leave behind will become more specific and potentially damaging, if used improperly. It is critical that we understand what information companies like yours are already collecting and selling.”

But Woolley argued that the data collection leads to consumers getting what they want – information, products, benefits, upgrades – when they want it. “There is no evidence that data-driven marketing harms consumers in any way,” Woolley said.

Scott Howe, chief executive of Acxiom, told the New York Times that his company looked “forward to continuing to work with the Congress to help the members gain a deeper understanding of Acxiom’s business and how people and the economy benefit from the appropriate use of data.”

In an E-mail, Demitra L. Wilson, a spokeswoman for Equifax, said the company is not a data broker and that the only a small portion of its business involves unregulated, aggregated data about consumers. And Gerry Tschopp, a spokesman for Experian, said the company welcomed the opportunity to discuss “the benefits of the appropriate use of consumer data” with legislators.

 


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