Privacy regulation is a jumble of irreconcilable rules that does little to protect consumer data.
Protection of personal information has drawn increasing attention because of problems such as identity theft, the Hewlett-Packard pretexting scandal, and data losses by major corporations and government agencies. Congress and the states have responded by enacting numerous statutes to protect consumers. But one type of information that has received less attention is the sale of consumer lists.
While most consumers probably understand that mailing and similar lists exist, many may be surprised by the type of information available. Want a list of Jewish donors broken down by age and the presence of children? Check the Web. One broker offers lists of the members of more than 40 ethnic groups. Or maybe you would like one of the dozens of lists of users of particular medications. Lists can be broken down by income, geography, marital status, age, and gender.
The sale of such lists raises several issues. One issue is simply privacy. To be sure, some list creators offer consumers an opportunity to opt out of the sale of information about them. But federal law imposes no obligation to offer an opt-out, and even compilers who offer an opt-out may not explain that the failure to opt out may land consumers on a list organized by ethnicity or other private information. Of course, list sellers have little incentive to tell consumers things that may cause them to opt out because lengthier lists are more valuable.
The availability of lists also permits marketers to engage in discrimination. Federal law bars discriminating on the basis of national origin, for example, in lending, but it does not prevent a seller of products from sending mailings only to members of a favored group. Sellers can also fine-tune their solicitations and make different offers to different groups.