Cell phone operators face a $ 200 million fine for not protecting location data

The sale of location data has become a hot business as smartphones have proliferated and the technology to obtain their whereabouts has become more accurate. The information is valuable for marketing specialists, police departments and even investment companies, as it can provide revealing details about people’s daily lives, such as where they live, what stores they frequent and what doctors they visit.

The location data trade is not regulated to a large extent. F.C.C. It is possible only because the telecommunications industry is subject to stricter regulations than technology companies. Companies that range from small application manufacturers to tech giants such as Google collect massive amounts of GPS, Wi-Fi and other data, without specific laws that address what they can do with it.

Cell phone operators aimed to obtain a part of the business through agreements with so-called location aggregators, intermediary companies that provided the information to other companies. Cellular network data is often less accurate than application information, but it covers the vast majority of the population and is almost always available.

To protect privacy, operators relied on a system of contracts that required location companies to seek customer consent, responding to a text message, for example, or by pressing a button on an application. But operators failed to catch several companies and people who followed customers without their permission.

The F.C.C. He said he began his investigation immediately after an article in The New York Times showed how the system had caused privacy violations. The Times in 2018 reported that the data was finally directed at law enforcement, including a former sheriff who used it to track people without a court order. He gained access by uploading documents that, he falsely claimed, were legal orders, including his car and health insurance policies and job training manuals, according to local reports of his accusation.

Securus Technologies, the company that offered the data to law enforcement, is best known for providing telephone services to inmates. Mr. Pai, the F.C.C. president, represented Securus while working at a law firm in 2011; He also worked as a lawyer for Verizon.

After the Securus episode, the companies said they would drastically limit the practice. But in early 2019, the Motherboard technology website showed that carriers were still selling data and that it was ending up in the hands of bounty hunters.

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