GM hit with data-sharing ban from FTC

A settlement has been agreed upon between the FTC and GM.

The US Federal Trade Commission (FTC) has taken action against General Motors (GM), as well as OnStar, for allegedly misusing driver data.

Under a proposed order settling the FTC’s allegations, General Motors LLC, General Motors Holdings LLC and OnStar LLC, which are owned by General Motors Company, will be banned for five years from disclosing consumers’ sensitive geolocation and driver behavior data to consumer reporting agencies.

According to the FTC, which aims to promote competition and protect US consumers, the implementation of yesterday’s ban (16 January) marks the organisation’s first action related to connected vehicle data.

The motoring giant was reprimanded over allegations that it “collected, used and sold drivers’ precise geolocation data and driving behaviour information from millions of vehicles – data which can be used to set insurance rates – without adequately notifying consumers and obtaining their affirmative consent”. It also comes following an investigation by The New York Times last year which shed light on the controversial practice.

Specifically, in its complaint, the FTC said that GM employed a misleading enrolment process to get consumers to sign up for its OnStar connected vehicle service, as well as the OnStar Smart Driver feature, which it claims resulted in data misuse.

In a statement, the FTC explained that tracking and collecting geolocation data “can be extremely privacy invasive, revealing some of the most intimate details about a person’s life, such as whether they visited a hospital or other medical facility, and expose their daily routines”.

FTC chair Lina M Khan claimed that GM sold people’s precise geolocation data and driver behaviour information “sometimes as often as every three seconds”.

Under the action, the FTC has proposed a five-year ban which prevents GM from disclosing consumers’ sensitive geolocation and driver behaviour data to consumer reporting agencies.

“With this action, the FTC is safeguarding Americans’ privacy and protecting people from unchecked surveillance,” Khan asserted.

Justin Brookman, director of technology policy at CR and a former policy director of the FTC’s Office of Technology, Research and Investigation, criticised GM over the controversy.

“Secretly collecting and sharing driver location data is a terrible practice that can cause real harm to unsuspecting consumers,” he said. “We are encouraged that the FTC is taking action under existing consumer protection law to put a stop to it, but because of ambiguity in the law, the best way to avoid these types of abuses in the future is a strong and clear comprehensive privacy law that restricts unwanted data sharing by default.”

In a statement, GM said that the settlement relates to the “now-discontinued Smart Driver program”.

“Last year, we discontinued Smart Driver across all GM vehicles, unenrolled all customers and ended our third-party telematics relationships with LexisNexis and Verisk.”

As part of the agreement, GM has asserted that it will obtain affirmative customer permission to collect, use or disclose certain types of connected vehicle data (with exceptions for certain purposes). The duration of the agreement is 20 years, the company added.

“We’re also giving customers more transparency and control,” GM claimed. “We’ve expanded a GM privacy program to provide customers in all 50 states with options to access and delete their personal information.”

Last month, GM announced that it will no longer fund its robotaxi project. At the time, the company said that planned to realign its autonomous driving strategy and prioritise the development of advanced driver assistance systems “on a path to fully autonomous personal vehicles”.

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