By Mary Mosquera,
WASHINGTON -- Commercial Internet sites have had three years to adopt voluntary privacy policies, and it's time to apply light legislation to prompt nonparticipating companies to protect consumer privacy online, the chairman of the Federal Trade Commission told lawmakers Thursday.
Consumer privacy and use of personal information have become leading Internet issues, and consumer concerns have discouraged some from doing business online, said FTC Chairman Robert Pitofsky, the nation's top regulator for consumer protection.
The FTC earlier this week said it supports laws to back up industry self-regulation in convincing sites to display a privacy policy. Fair information practices should be the mainstay of any privacy policy, including notice to a consumer on how information is used, the choice to opt out, access to personal information, and security of personally identifying data, Pitofsky said.
Senate Commerce Committee chairman John McCain (R-Ariz.), whose committee questioned FTC commissioners and privacy experts on the need for legislation, said the issue had become more complex for consumers who have to wade through privacy policies that are often lengthy and written in "mumbo-jumbo."
The latest survey of random sites and the 100 most popular commercial Internet addresses shows more sites are posting privacy policies than last year, but it is still not enough, Pitofsky said. The FTC also surveyed sites for the quality of their privacy policies and for how easy they were to understand.
Some of the most popular sites had lengthy privacy disclosures and disclaimers, written in single-space lines running over several screens. On one site, a reader has to sift through 10 screens of legalese to find the place to decline having personal information used, Pitofsky said.
"If I didn't have someone to help me, I would have been lost between the third and fourth screens," the told the panel. "If you can't give better privacy than that, you need a backup."
Many sites don't offer privacy protection because they are "bad actors" for the industry or are new to e-commerce and don't have the expertise or money to develop a policy, Pitofsky said. Though he credited the companies that display clear policies, he noted that "inappropriate invasions of privacy are going on all the time that we can't get a handle on." The FTC has the authority to enforce consumer privacy standards when violations constitute fraud.
Two bills were mentioned that protect consumer information online: The Consumer Privacy Act, S. 2606, introduced this week by Sen. Ernest "Fritz" Hollings (D-S.C.), and one introduced in the previous Congress by Sens. Ron Wyden (D-Ore.) and Conrad Burns (R-Mont.), which is being redrafted. But the shortened congressional session makes it unlikely that either will pass before the November elections.
"If it can be done appropriately in this short period of time, fine," Pitofsky said. "But it is more important to get it right."
"This is no sinister government power grab, but it gives consumers power over their information," Wyden said.
Technology advances and consumer education are also key to privacy protections, the FTC said.
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