Khan: Amazon Case Shows Endless Data Collection Won’t Be Tolerated

The FTC’s case against Amazon and Alexa data privacy practices shows tech innovation isn't an excuse for companies to ignore privacy obligations, FTC Chair Lina Khan said Wednesday. Companies can’t retain user data “forever” just because it could be useful to AI training models in the future, she said during FTC PrivacyCon. Amazon in June agreed to pay more than $30 million to settle several allegations, including FTC claims the company violated privacy law when it retained children's voice and geolocation data despite parents requesting deletion. The rise of AI motivates companies to “vacuum up” user data, so “rules of the road” are “more essential than ever,” said Khan. AI presents a moment of “opportunity” with “tremendous risk,” and companies shouldn’t be “racing to the bottom” with business models that entrench data surveillance, automate discrimination and turbocharge fraud, she said. The FTC in other cases has made clear that selling certain data is “presumptively off-limits,” including data related to location, health and browsing history, she said. Commissioner Alvaro Bedoya added, this FTC won’t hesitate to seek outright bans on specific commercial practices that violate user privacy. He noted that in at least three instances recently, the commission banned companies from engaging in specific conduct as part of proposed settlements. This included the FTC’s December settlement banning Rite Aid from conducting facial surveillance for five years. The FTC’s January settlement banned InMarket from selling or licensing precise location data, and February’s banned Avast from selling browsing data for advertising purposes. If a company violates consumer privacy, the FTC will “seek the strongest protections for consumers” to end the practice, said Bedoya. Commissioner Rebecca Kelly Slaughter noted agency staff’s recent business guidance on enforcement against mass data collection practices. The bottom line, she said, is that “unfettered data collection can easily put you in violation of the FTC Act.”