FTC bans Austin company InMarket from selling sensitive consumer location data

Federal regulators are cracking down on an Austin-based data broker they say inappropriately used consumer location data.

The U.S. Federal Trade Commission announced on Thursday it reached a settlement with Austin-based InMarket in the latest move by the agency to restrict data brokers from selling sensitive consumer data.

InMarket makes a marketing platform that collects consumer information that is then used by brands and advertising agencies to better target consumers. In an announcement, the regulatory agency said the agreement would settle its allegations that the company did not fully inform consumers and obtain their consent before using and collecting location data for advertising and marketing.

More: Google adds disclaimer that Chrome's incognito mode still tracks user data: Reports

Under the settlement, the company will also not be allowed to sell, license or share any products based on "precise location data." The FTC order defines location data as any that reveals a consumer or mobile device’s precise location including those collected using GPS coordinates, cell tower information, WiFi or Bluetooth technology.

In the announcement, FTC Chair Lina M. Khan said the agency will continue to protect Americans from unchecked corporate surveillance.

"All too often, Americans are tracked by serial data hoarders that endlessly vacuum up and use personal information," Khan said. "Today’s FTC action makes clear that firms do not have free license to monetize data tracking people’s precise location."

The FTC alleged the company failed to obtain consent from people using its apps, ListEase and CheckPoints, by using misleading prompts and not informing consumers of how the apps would use the data. The agency also alleged the company did “little” to verify how third-party apps using InMarket’s tracking code were notifying users of how their location data would be used.

More: Xfinity data breach, Comcast hack affects nearly 36 million customers: What to know

The FTC said InMarket had nearly 2,000 audience segment lists that grouped together users based on traits including Christian church goers and “parents of preschoolers” that could be used to display ads to specific audiences. The company was also retaining geolocation data for five years, a practice the FTC said was "unnecessary" and led to increased risks.

The settlement action outlines several requirements designed to strengthen consumer protections, including requiring the company to destroy previously collected data unless consumer consent is obtained. It also orders the company to notify all consumers if their location data was collected.

In a statement, InMarket denied the FTC’s allegations, and said it has “no interest in selling consumer location data."

"We share the FTC’s commitment to advancing consumer privacy, and while we fundamentally disagree with the FTC’s allegations, we are happy to reaffirm the steps InMarket is taking to further our policies around data disclosure and use," the company said in a statement.

More: Is it smart to hand over your email address and phone number for discounts?

InMarket also said it would expand its sensitive location protections.

The agreement, which FTC commissioners voted 3-0 in favor of, will be open to public comment for 30 days before the commission decides if it will make the order final.

The settlement followed just days after the FTC issued an order against another data broker, Outlogic, banning it from selling sensitive location data. The agency alleged Outlogic was selling precise location data that could be used to track visits to sensitive locations such as medical visits, houses of worship and domestic abuse shelters.

The order comes as the FTC has increasingly prioritized expanding privacy protections, particularly following concerns about privacy after Roe v. Wade was overturned in 2022. President Joe Biden also issued an executive order in 2022 directing the FTC to take steps to protect user data related to reproductive health care services.

This article originally appeared on Austin American-Statesman: FTC bans Austin company InMarket from selling sensitive location data