Who data brokers are, and how they quietly sell your data

Anton P. | May 18, 2021

Data brokers are entities that collect and sell consumer information. The data broking industry generates billions of dollars, but it also spends most of its time in the shadows. You might not have heard any of the big representatives of this booming industry. However, the chances are, they know a lot about you. And they are not reluctant to share their insights with interested parties. Thus, let’s unveil the mystery behind data brokers, and how they manage to stay quiet about their activities.

What are data brokers, and what do they do?

Data brokers (or information brokers) are companies that collect, aggregate, bundle, and sell user data. Our digital lives leave clear trails that brokers follow attentively. Typically, they harvest information available on social media and track users’ browsing habits across various websites.

However, data brokers might have a broader selection when it comes to the information they harvest. They might attain data from public records that can later be repurposed for people search websites. The latter can allow anyone to find information on specific individuals like their physical addresses, phone numbers, relatives, age, etc.

After picking up consumer information, data brokers will use machine-learning algorithms for further processing. This automated data analysis identifies specific patterns to generate segmented profiles of people with similar interests. Thus, data brokers can divide people into precise groupings. For instance, some sets might relate to “female consumers interested in cars,” “or “20-40-year-old males living in the US.”

The generated clusters can take various details into account. It might look at age, income, general interests, stage of life, buying habits, etc. According to Wired, such point-blank classifications might be particularly harmful to oppressed or marginalized groups. The latter includes people subjected to oppression due to their race, sexual orientation, gender, or mental ability. Thus, while a group of “rock-climbing enthusiasts” sounds innocent enough, “LGBTQ members” might not.

However, companies worldwide purchase such data to connect to audiences interested in their products or services. While it helps boost businesses and attract new clients, experts notice the gaping ethics hole. Consumers typically have no idea which data brokers have data on them. Typically, such information is available within terms of use or privacy policy documents. Sadly, millions of users tend to skim through them or disregard them entirely.

Who buys information from data brokers?

The insight-laden streams of information typically serve thousands of companies looking for customers. The aggregated profiles end up available to companies that users themselves have never encountered.

Have you ever received bizarre marketing emails from companies you never gave access to your email address? An exchange between data brokers and the company likely led to you receiving the offbeat message.

However, companies that want to shove marketing letters to you are not the most significant issue here.

According to The Wall Street Journal, immigration authorities have purchased access to users’ location data to locate undocumented immigrants. Thus, law enforcement agencies also want a bite of the insightful databases data brokers have.

The Federal Bureau of Investigation is also a client of Venntel, a company mapping and selling the movements of millions of Americans. Thus, the FBI retrieves access to smartphone location data from the data broker. Immigration and Customs Enforcement (ICE) appears to have gained access to home address information to conduct deportations. Thus, data brokers have a diverse clientele interested in consumer data.

Inaccurate information data brokers sell

Besides quietly abusing consumer data for monetary gain, data brokers and their massive databases have another problem. An article on Harvard Business Review is one of the many asking a relatively simple question. Is the information data brokers sell accurate?

In many cases, the sold “product” might not be of the greatest quality. Data brokers might assign people to groups that do not represent them. Thus, even if businesses pay a hefty sum for reaching “cycling enthusiasts,” they might not.

Inaccuracies and poor-quality data are not fatal mistakes in this case. However, there are situations when incorrect insights from data brokers can directly affect people’s lives.

An investigation has shown just how damaging incorrect information can be. There are accounts of people wrongfully losing housing due to flawed screening processes. Typically, companies would use data brokers’ insights, or people search websites to make their rulings. If background checks rely on such information, they are bound to make unjustified decisions.

Data brokers and little to no regulation

With certain exceptions, data brokers’ activities go unregulated and unnoticed for the most part. By using certain apps or visiting websites, you also agree to have your data transferred to data brokers. Thus, it becomes critical for you to read the terms of use and privacy policies presented to you.

The California Consumer Privacy Act and Vermont’s Data Broker Law do require data brokers to register with the state routinely. However, the laws that would govern these for-profit companies more actively are sparse.

Advocates against unnecessary tracking and data harvesting strongly encourage the introduction of new regulations. They need to address that most of these activities happen without explicit consent and might drastically affect people’s lives.

The potential for doxxing, stalking, or intimate partner violence are also issues requiring immediate attention. After all, data brokers typically sell data to anyone interested. Furthermore, people search websites could generate highly sensitive reports for a small fee. Policymakers must be strict about such affairs and contribute to its successful regulation.

What can you do?

Data brokers operate massive databases by scraping public records and tracking you online. They might know your age, income, sexual orientation, buying habits, mental health, physical address, etc. Thus, it is understandable that you do not want your data harvested and sold to basically anyone.

Unfortunately, avoiding the reign of data brokers is not easy. By this point, they are likely to know more about you than some of your closest friends. A small silver lining is that you can contact data brokers and demand them to delete your data. However, with so many data gatherers around, it will take a while to confront each of them.

But this does not mean that you need to make it easy for data brokers to track you. Make it a rule to carefully read privacy policies and terms of use of websites and apps you use. Some services can also help you remove your name from direct marketing and telemarketing lists. It is also possible to pay certain private companies to keep your data away from data brokers. However, they are quite expensive.

Lastly, you can become more vigilant about which data you release to the public domain. For instance, avoid being too open on social media. A VPN (Virtual Private Network) can also help you cover your tracks online. In essence, it encrypts information about your web traffic and masks your IP address. Thus, data brokers and various other entities online will have fewer chances of snooping on you.

Anton P.

Anton P.

Former chef and the head of Atlas VPN blog team. He's an experienced cybersecurity expert with a background of technical content writing.

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