US telcos will be fined $200m for harvesting and reselling customer data

Published: 1 March 2020 - 7:54 a.m.

The US’ top telecoms regulatory authority, The Federal Communications Commission, has proposed levying fines of up to $200 million in fines against the country’s big four telcos.

AT&T, Sprint, T-Mobile and Verizon all stand accused of selling their customers location data to a variety of firms, including private companies in the bail and bonds business.

Last year, a report published by Motherboard claimed that for $300 it was able to pay a bounty hunter to track the location of a T-Mobile customer, using real time geolocation data purchased from the US telco.

"The bounty hunter did this all without deploying a hacking tool or having any previous knowledge of the phone’s whereabouts. Instead, the tracking tool relies on real-time location data sold to bounty hunters that ultimately originated from the telcos themselves, including T-Mobile, AT&T, and Sprint, a Motherboard investigation has found. These surveillance capabilities are sometimes sold through word-of-mouth networks," the Motherboard report said.

Operators in the US have routinely sold their customers' location data to third party companies, known as location aggregators. This data can be purchased by legitimate clients, for example road side assistance firms who use it to pinpoint the location of a broken-down vehicle, however, more often than not, the data is being purchased for other purposes.

"Companies are selling phone geolocation services with little oversight to a spread of different private industries, ranging from car salesmen and property managers to bail bondsmen and bounty hunters," the Motherboard report found.

On Friday, the FCC said that it would impose fines on all four of the country’s big telcos (now three, following Sprint’s merger with T-Mobile). The FCC will seek $91 million from T-Mobile, $57 million from AT&T, $48 million from Verizon and $12 million from Sprint.

“This FCC will not tolerate phone companies putting Americans’ privacy at risk," FCC chairman, Ajit Pai, said in a statement.

US telcos will now have the opportunity to argue their case against the proposed fines, before the FCC reaches a final decision on the matter.

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