The Federal Trade Commission (FTC) has banned General Motors (GM) and its subsidiary OnStar from selling driver data to third parties for the next five years. This move follows an investigation triggered by a report from The New York Times, which exposed the companies for collecting and sharing sensitive customer information with insurance companies without proper consent.

GM and OnStar’s Controversial Data Practices Revealed

The investigation uncovered that GM was collecting vast amounts of customer data, including behaviors such as hard braking, speeding, and nighttime driving, through its OnStar Smart Driver program. What was particularly troubling was that many vehicle owners were either unaware of their participation or didn’t realize they had consented to the collection of this information. GM sold the data to brokers like LexisNexis Risk Solutions and Verisk, who then passed it on to insurance companies for risk assessment purposes.

FTC Takes Action to Safeguard Privacy

In response to the report, GM stopped sharing the data with these brokers. However, the FTC’s latest settlement imposes stricter measures. GM and OnStar are now prohibited from sharing location and driver behavior data for five years. Moreover, the companies will be required to bolster transparency and give consumers more control over the data being collected about them.

A Win for Privacy Protection

“GM tracked and sold precise location data and driver behavior information, sometimes as often as every three seconds,” said FTC Chairwoman Lina M. Khan. “With this action, the FTC is protecting Americans’ privacy and protecting people from unchecked surveillance.”

This ruling highlights the growing concerns about privacy and data collection in the age of connected vehicles. Consumers are advised to remain vigilant about the data they share and demand greater transparency from companies that collect personal information.

For further details, visit the source article on Engadget.