FTC reminds data brokers of their duties to protect the data of American citizens

The Federal Trade Commission (FTC) has sent letters to 13 data brokers to remind them of their legal duties to protect the sensitive data of Americans in accordance with the Protecting Americans’ Data from Foreign Adversaries Act (PADFAA).

PADFAA, which went into effect in 2024, prohibits data brokers from selling, releasing, disclosing, or providing access to personally identifiable sensitive data about Americans to any foreign adversary. This includes countries like China, Iran, North Korea, and Russia.

According to this legislation, personally identifiable sensitive data includes information regarding someone’s health, finances, genetics, biometrics, geolocation, and sexuality, as well as device login credentials and government-issued identifiers such as Social Security Numbers, passports, or driver’s license numbers.

In the letter, the competition supervisor says it’s monitoring the marketplace for potential violations of the FTC Act, PADFAA, and other laws and rules that can be enforced by the Commission for sharing or selling sensitive information of American citizens to adversarial countries.

The FTC recommends that the data brokers conduct a comprehensive review of their business practices to make sure they comply with PADFAA. Companies that violate these rules are advised to discontinue their practices to avoid hefty fines.“Deceptive and unfair acts or practices that violate the FTC Act may be subject to legal action and court injunctions. In addition, companies that violate PADFAA may be subject to an FTC enforcement action and civil penalties of up to $53,088 per violation,” the United States watchdog states.

“The FTC is committed to enforcing PADFAA and ensuring companies are complying with its requirements,” Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection, says in a statement.

“These letters should send a message to all data brokers to be aware of the law’s requirements and ensure they are not engaging in practices that violate it,” he continues.