US bill proposes personal liability for company executives over data misuse

By on 28/10/2019 | Updated on 04/02/2022
Mark Zuckerberg: The FTC fined Facebook US$5bn in July for its failure to safeguard the data of up to 87 million people in the Cambridge Analytica scandal. (Image courtesy: Anthony Quintano via flickr)

US Democrats are championing a bill which, if passed, would make it a criminal offence for company bosses to lie to the Federal Trade Commission (FTC) about privacy practices.

The Mind Your Own Business Act would give the FTC, which is responsible for privacy protections, the power to impose jail sentences of up to 20 years on executives who are found to have lied about data regulation compliance.

“Mark Zuckerberg won’t take Americans’ privacy seriously unless he feels personal consequences,” said Democrat senator for Oregon Ron Wyden. “A slap on the wrist from the FTC won’t do the job, so under my bill he’d face jail time for lying to the government.”

Wyden was referring to the FTC’s decision to fine Facebook US$5bn earlier this year for its failure to safeguard the data of up to 87 million people in the Cambridge Analytica scandal. It was the largest fine imposed by the FTC but represented just a month’s sales for the social media network, and the sum has been heavily criticised as inadequate. Wyden said at the time that the FTC had “failed miserably”.

News of the bill comes in the same week that the federal trade commissioner, Rohit Chopra, told a House judiciary subcommittee hearing – which was examining data privacy and the market power of large online platforms – that the US government has been too soft on big tech companies. He argued that the FTC’s US$5bn settlement with Facebook is probably not punitive enough to stop the company from engaging in similar behaviour in the future.

“These big fines are not big penalties for big companies,” he said in his testimony. He added that he’s concerned that “all too often, the government is too captured by those incumbents that use their power to dictate their preferred policies”, and said that there should be consequences for individual executives of companies that repeatedly violate the FTC’s rules. 

Giving consumers control of their data

This is a view shared by the experts who informed the Mind Your Own Business act. Prior to designing the proposed bill, Senator Wyden said he spent a year talking to experts about what was required to curb big tech companies’ misuse of citizen data. Three clear messages emerged, he said: there must be real consequences for executives who break the rules; consumers need to be given back control of their data; and companies must be far more transparent about what they do with that data.

As well as seeking to furnish the FTC with the power to jail company bosses, the bill calls for a nationwide ‘Do Not Track’ register that would enable consumers to stop companies from monitoring their activity online, or selling or sharing that data to target advertising. It would also require companies to provide an easy way for people to see what data is held on them and which other companies have access to it, and to correct inaccuracies.

Under the bill, the FTC would be able to fund state-based organisations to file complaints on behalf of consumers, and to force companies to ensure that any algorithms used to process consumer data are accurate, fair, and not biased or discriminatory. The law would also require the FTC to set minimum standards for privacy and cybersecurity, which would be compulsory for all organisations. It would be able to fine companies 4% of their annual revenues for first offences.

About Mia Hunt

Mia is a journalist and editor with a background in covering commercial property, having been market reports and supplements editor at trade title Property Week and deputy editor of Shopping Centre magazine, now known as Retail Destination. She has also undertaken freelance work for several publications including the preview magazine of international trade show, MAPIC, and TES Global (formerly the Times Educational Supplement) and has produced a white paper on energy efficiency in business for E.ON. Between 2014 and 2016, she was a member of the Revo Customer Experience Committee and an ACE Awards judge. Mia graduated from Kingston University with a first-class degree in journalism and was part of the team that produced The River newspaper, which won Publication of the Year at the Guardian Student Media Awards in 2010.

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