The Pontiflex Blog

FTC in Favor of Strong Privacy Policies

July 13, 2010 at 3:06 pm Nick Herman Leave a comment

What happens to your user data is the company that collected it goes bankrupt? Nothing, according to the FTC.

When XY magazine/XY.com collected user data during their 11 year history it promised, via a strong privacy policy, that it “never sells its list to anybody.” However, it appeared that when the company went bankrupt all bets were off and the collected data was listed as a saleable part of its estate. Now the company’s creditors want to sell the data to recoup their losses.

But what about the privacy policy that XY subscribers had put their faith in? Did it cease to exist along with the company that created it? Hopefully not. The FTC has decided to weigh in on the issue and, in a letter to those involved, strongly warned against any attempts to sell the XY user list. In a statement a spokesperson for the FTC wrote, “Subscribers and members were told that their personal information would not be sold, shared, or given away to ‘anybody.’ Therefore, any sale or transfer of the data to a new company, new owner, or other third party would directly contravene the privacy representations and could constitute a deceptive practice by the original company or its principals.”

So, what does this mean for those of us who make our living trading in user data? It’s hard to say, since these issues have yet to go to court. But for Pontiflex, at least, it means that the FTC has affirmed one of our core values: respect the user’s wishes by never reselling their data. It seems pretty obvious to us but it never hurts to have a US government agency come down on your side.

Check out the original article.

Entry filed under: Privacy. Tags: nickherman.