Bulletins

Congress is actually taking a go at a real privacy bill

Three of the four congressional negotiators have come to agreements on consumer lawsuits, preemption of state laws and much more, but the sudden action doesn't mean the text is close to passing.

The exterior of the U.S. Capitol building

After years of stalemate, some of the key lawmakers in the privacy debate have made progress.

Photo: Louis Velazquez/Unsplash

Three of the four top congressional negotiators working on privacy have released a draft bill that would require companies to collect the least amount of data necessary to provide a service, end ad-targeting to kids up to age 16 and mandate annual civil rights assessments of algorithms used by the largest companies.


in addition, the draft would allow users to opt out of targeted advertising, and would permit individuals to sue over certain prohibited data uses. While it would also overrule many state privacy provisions, the draft bill would dramatically increase the Federal Trade Commission's power to make rules in certain areas of privacy.

The text, known as the American Data Privacy and Protection Act, represents a bipartisan, bicameral agreement after years of stalled talks on data protection. It also lays out compromises on issues, such as lawsuits, that had stymied lawmakers even as industry, consumer groups and political leadership pushed Congress to act.

Despite the existing bipartisan agreement, the proposal still faces significant hurdles to becoming law this year. Foremost among them: It does not have sign-on from Democratic Sen. Maria Cantwell, who chairs the Senate Commerce Committee and is the most powerful legislator in the process. Although Cantwell reportedly is aiming to hold a hearing on privacy legislation in coming weeks, she dismissed the draft on Friday as doing too little to ensure companies "act in consumers’ best interests," according to the Washington Post.

Congress also is trying to tackle major hot-button issues such as guns and abortion, while also moving forward with tech antitrust legislation. Lawmakers are also running against the clock, hoping to finish much of that work in the dwindling number of days left before the unofficial kickoff of the midterm campaign season in August and the election itself in November.

In addition, while some tech industry groups welcomed the progress, they also hinted they hoped for further concessions. And the U.S. Chamber of Commerce, the most powerful business lobby, said earlier this week it would use its firepower to oppose a text with "a blanket private right of action" allowing consumers to sue.

"In the coming weeks, we will be working with our colleagues on both sides of the aisle to build support and finalize this standard to give Americans more control over their personal data," said a statement from Reps. Frank Pallone and Cathy McMorris Rodgers and Sen. Roger Wicker. Pallone chairs the House Energy and Commerce Committee, while McMorris Rodgers serves as its top ranking Republican member. Wicker is the highest-ranking Republican on the Senate Commerce panel.

The proposed bill would also offer consumers rights to access, correct, delete and move their data, and to opt out of its transfer to third parties — abilities that have become increasingly common under international or state privacy statutes. It would also put greater transparency requirements on companies, although some critics say those notices induce fatigue with consumers more than they empower consumer choices.

The bill includes a long list of provisions — such as those on data minimization and the handling of teens' information — that could alter the workings of tech giants as well as data brokers, smaller firms in the industry and brick-and-mortar companies that use data and algorithms, whether public-facing or B2B.

The measure, for instance, would designate categories of sensitive data to receive heightened protections, including information on health, finances, location and biometrics. The sensitive category would also include "information revealing" race, religion, union membership and sexual orientation, among other classifications that are sometimes evident not just from users' direct statements about themselves but also through an easy analysis of their interests, home addresses, travel patterns and more.

In addition to the civil rights assessments for big companies' algorithms, the draft forbids data uses that discriminate "on the basis of race, color, religion, national origin, gender, sexual orientation, or disability."

The text would also require companies to obtain express consent to collect and use most biometric and genetic information, and ban most handling of revenge porn. It would also require reasonable security practices and force CEOs of big companies to certify their firms have procedures in place to comply with the law, which could potentially put them on the hook personally for lapses.

Latest Bulletins

Ending a project that once sought to build a world-spanning financial network, Meta announced on the Novi website Friday that the pilot test of its blockchain-based money-transfer app would end in September.

Keep Reading Show less

In the wake of privacy concerns following Roe v. Wade being overturned, Google said Friday that it will start automatically deleting location history related to potentially sensitive places.

Keep Reading Show less

Voyager Digital said Friday it is suspending trading, deposits and withdrawals, in the latest sign of the deepening crisis in the crypto markets. Voyager said the move is meant to give the major crypto broker “additional time” to look for “strategic alternatives” as the company grapples with the impact of the market slump, CEO Stephen Ehrlich said in a statement.

Keep Reading Show less

BlockFi CEO Zac Prince said his company has signed a deal giving FTX the option to buy the crypto lender for up to $240 million as part of a credit financing agreement.

Keep Reading Show less

Tesla is facing yet another racial discrimination lawsuit, this one brought by 15 Black current and former employees who are suing the company in California.

The workers said the company’s culture allowed for “blatant, open and unmitigated race discrimination” and most of the alleged behaviors are said to have occurred at the company's factory in Fremont.

Keep Reading Show less

Klarna is close to raising new funding at a valuation of about $6.5 billion, which would be far below its last round raised last year, according to the Wall Street Journal. The move is the latest sign of the effects of inflation and the economic downturn on the fintech sector and "buy now, pay later" in particular.

Keep Reading Show less

Crypto companies will have to disclose just how much climate damage is tied to the tokens they're hawking. At least in Europe, that is.

Keep Reading Show less

Gene Levoff, Apple's former director of Corporate Law, pleaded guilty to insider trading, the Department of Justice announced Thursday.

Keep Reading Show less

New York state environmental regulators have declined to extend a key permit to a controversial cryptocurrency mining operation in the state's Finger Lakes region.

Keep Reading Show less

FTX is reportedly close to gobbling up BlockFi for about $25 million, though BlockFi's CEO has dismissed the talk as "market rumors."

Keep Reading Show less

The CFPB said it has terminated a sandbox deal that gave earned wage access provider Payactiv “temporary safe harbor from liability” under key lending regulations.

The CFPB granted Payactiv “special regulatory treatment” in December 2020 to offer “earned wage access” products that would allow employees to obtain wages they already earned before payday.

Payactiv gets paid back through a payroll deduction from the employee’s next paycheck. The company makes money through fees.

The CFPB said it had informed Payactiv early this month that it was “considering terminating the approval order in light of certain public statements the company made wrongly suggesting a CFPB endorsement of its products.”

The company requested that the CFPB end the sandbox order after notifying the agency that it planned to modify its product fee model, the CFPB said.

The move underlined the CFPB’s increasingly critical view of sandbox deals that the agency said “proved to be ineffective.”

Safwan Shah, Payactiv's founder and CEO, is credited with coining the term "earned wage access," which has been criticized by consumer advocates as being potentially predatory, especially when it comes to workers who don’t make much money.

Shah has argued that it benefits ordinary workers, citing a dieting principle: "The less you are paid, the more frequently you should be paid," he told Protocol in a 2021 interview. "If you're going to eat 500 calories, don't eat them in one sitting. Spread them throughout the day."

Correction: This story has been updated to correct the spelling of Payactiv's name. This story was updated June 30, 2022.

Samsung announced Wednesday that it has taken a significant step toward rolling out a next-generation manufacturing technology that has the potential to reshuffle the chip industry.

Keep Reading Show less

Amazon has censored search results related to LGBTQ+ products in the United Arab Emirates after being pressured by the government.

Keep Reading Show less

Grayscale is suing the U.S. Securities and Exchange Commission after the regulator denied the company's bid to convert its bitcoin trust into an exchange-traded fund.

Keep Reading Show less

App developers in South Korea can now use third-party payment systems, Apple announced in a blog post Thursday.

Keep Reading Show less

An employee working for OpenSea's email delivery vendor misused their customer data access to download and share email addresses with an "unauthorized external party," the NFT marketplace wrote in a company blog post Wednesday. The employee worked for Customer.io.

Keep Reading Show less

Javier Soltero is leaving Google Workspace, Google Cloud CEO Thomas Kurian announced Wednesday in an email to staff viewed by Protocol. Soltero will leave his role effective July 15.

Keep Reading Show less

San Francisco-based game development tools provider Unity is laying off hundreds of employees, according to a report from Kotaku.

Keep Reading Show less

Niantic is reportedly cutting between 85 and 90 staff members, or 8% of its workforce.

Keep Reading Show less

Crypto hedge fund Three Arrows Capital has reportedly received a court order to liquidate after creditors sued the company over unpaid debts.

Keep Reading Show less

Just months after committing to spend $925 million on carbon dioxide removal, a collection of major tech companies has announced its first purchases. The group, operating under the banner of Frontier, announced it had purchased nearly 2,000 tons of CDR services from five companies. It's a small ripple in the CDR pond, but one Frontier hopes will turn into a wave to bring down the costs of removing carbon.

Keep Reading Show less

The Federal Trade Commission has sued Walmart, alleging the retail giant "turned a blind eye" to fraud worth hundreds of millions on its money transfer services.

Keep Reading Show less

Eric Schmidt described his first five years at Google as "pure, naive techno-optimism," in that the company believed that applying American values like free speech is good for the world. But Google hit a brick wall when it bought YouTube.

Keep Reading Show less

The Biden administration's hot electric vehicle summer continues to zip along. On Tuesday, the White House announced $700 million in commitments for EV charging from private companies. The cash will up U.S. charging manufacturing capacity to 250,000 chargers a year and increase the number of chargers out in the wild. Not too bad!

Keep Reading Show less

Meta said it's working to correct enforcement errors that led to the removal of Facebook posts related to abortion pills and suspensions of user accounts behind the posts. The clarification came after Motherboard discovered that Facebook was instantly removing posts that said "abortion pills can be mailed," which the FDA legalized in 2021.

"Content that attempts to buy, sell, trade, gift, request or donate pharmaceuticals is not allowed. Content that discusses the affordability and accessibility of prescription medication is allowed," Meta spokesperson Andy Stone tweeted in response to the story. "We've discovered some instances of incorrect enforcement and are correcting these."

Keep Reading Show less
Bulletins