Phone Carriers to Face $200 Million in Fines After Illegally Sharing Phone Location Data

Illustration for article titled Phone Carriers to Face $200 Million in Fines After Illegally Sharing Phone Location Data

The Federal Communications Commission (FCC) is expected to seek a total of at least $200 million in fines from cellphone carriers accused of illegally sharing the location data of their customers, Gizmodo has learned.

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In 2018, the FCC’s enforcement bureau launched an investigation into the data sharing practices of several top carriers, including AT&T, Sprint, and T-Mobile, as allegations of widespread abuse arose after the New York Times reported that a former Missouri sheriff had paid a private company cash to track cellphones without a warrant, including, reportedly, those of other officers.

Sen. Ron Wyden demanded an investigation in May 2018, saying he’d learned that Securus Technologies, one of the largest prison phone providers in the country, had purchased “real-time location information from major wireless carriers” and provided that information at a cost “for nothing more than the legal equivalent of a pinky promise.”

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Motherboard later published a series of articles describing the ease with which its reporters were able to gain access carrier-provided location data, on one occasion paying $300 to put a trace on a cellphone that belonged to one of its reporters.

In January, FCC Chairman Ajit Pai revealed in letters to oversight officials that investigators had reached the conclusion that “one or more wireless carriers violated federal law.”

The Wall Street Journal reported on Thursday that the fines sought after by the FCC are likely in the “hundreds of millions.” A source with knowledge of the matter told Gizmodo the FCC is expected to seek around $200 million total.

That number, which may be challenged by the companies, is unlikely to be viewed by privacy advocates as much of a deterrent. AT&T’s annual revenue, for instance, broke $180 billion last year alone.

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Wyden specifically had strong words for the chairman’s decision, saying Pai had “failed to protect American consumers at every stage of the game” and only chose to investigate the matter after significant public pressure. “And now his response is a set of comically inadequate fines that won’t stop phone companies from abusing Americans’ privacy the next time they can make a quick buck,” he said.

Added Wyden: “Time and again, from Facebook to Equifax, massive companies take reckless disregard for Americans’ personal information, knowing they can write off comparatively tiny fines as the cost of doing business. The only way to truly protect Americans’ personal information is to pass strong privacy legislation like my Mind Your Own Business Act to put teeth into privacy laws and hold CEOs personally responsible for lying about protecting Americans’ privacy.”

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Last summer, every major carrier implicated in the scheme promised to cease or significantly curtail the sale of locations data in response to inquiries by FCC Commissioner Jessica Rosenworcel. Some companies said they would continue to share real-time location data with essential services, such as road-side assistance companies, which can automatically contact emergency services in the event of an accident.

Last month, FCC Commissioner Geoffrey Starks, a Democrat who told lawmakers last year that Chairman Pai had been withholding information about the carrier investigation from his office, said he was glad the “egregious allegations” had finally been acted upon.

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“My question is,” he added, “what took so long?”

This is a developing story.

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Senior Reporter, Privacy & Security

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DISCUSSION

Does the government keep that money? Or do lawyers get $199.9M of the money and the rest of us get an 18 cent voucher for dairy queen.

I expect that next month AT&T will add a “FCC Fine Payment Fee” to my bill