U.S. Consumer Watchdog To Query Tech Giants Over Financial Data -sources
WASHINGTON: The U.S. consumer watchdog is expected this week to query tech giants including Facebook, Amazon and Google on how they handle consumer financial data as part of a broader effort to boost consumer protections and financial sector competition, according to two people briefed on the matter.
The Consumer Financial Protection Bureau (CFPB) plans to send the companies a 55-page request for information about how they collect, use and market consumer financial data, the people said, speaking on the condition of anonymity.
“The regulator’s questions will pay special attention to what it is firms are collecting, how they’re collecting it and what they’re using it for,” said one of the sources.
The CFPB declined to comment. Facebook Inc., Amazon Inc. and Alphabet Inc’s Google, which are not directly regulated by the CFPB, did not immediately respond to a request for comment.
The expected request for information follows the arrival of Rohit Chopra as director of the CFPB following his Senate confirmation last month. A former Democratic commissioner at the Federal Trade Commission, he built a reputation as a consumer advocate who was frequently tough on big tech.
Democrats’ top policy priorities include boosting competition in the consumer finance sector by requiring financial companies to give consumers more control over their financial data — a concept known as “open banking.”
Requiring banks and other financial firms to allow consumers to download data about account balances, payments, transactions and investments and share it with a third party, for example, could make it easier for consumers to switch providers.
Chopra is expected to move ahead with an open-banking rule first proposed by the agency under the former Trump administration in coming months.
The companies’ confidential responses many help inform the open banking and other future rule makings, the source said.
“This move by the agency is a clear signal that this broader array of companies, which are not covered by the CFPB, are seen to undertake activities and collect consumer financial data that may be subject to future, open banking regulation,” the source added.
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