House Widens Black Market Phone Data Probe

The congressional hearings probing data brokers that sell personal phone records have concluded, but the lawmakers’ investigation continues.

As part of its latest update on the probe, House Energy and Commerce Committee investigators identified 22 more Web sites selling unauthorized personal phone data, including cell phone roaming records, the date and time of the calls, and their origin and destination.

The panel sent letters to the legal representatives of the sites demanding that the companies provide information about how the sites are obtaining the data.

Under the Telecommunications Act of 1996, telephone carriers are obligated to protect the Customer Proprietary Network Information (CPNI) of consumers. The CPNI is considered sensitive personal data since it includes logs of calls that individuals or businesses initiate and receive on their phones.

The phone companies claim they are being gulled out of the information by a technique known as “pretexting,” or assuming the identity of the real customer.

The selling of the records, though, appears to fall into a legal netherland; legislation to stop the practice is percolating in both the House and the Senate.

While the lawmakers’ draft their proposals, the sale of personal phone record data has become a cottage industry on the Internet.

“It is very disconcerting that certain online data broker companies are exploiting consumers’ personal records and selling the information to whomever pays for the records,” the House letters state. “With the exception of the legal activities of law enforcement authorities, we struggle to find any ethical justification for marketing this data.”

In addition to seeking the source of their data, House investigators want to know who the top customers of the sites are and detailed company records including annual gross and net revenue.

The committee is also seeking the 22 data brokers’ list of all business and Web sites with which they are affiliated.

Earlier this month, the panel sent a similar letter to Steven Schwartz, director of First Source Information Specialists, Inc., of Tamarac, Fla., which manages sites known as, and First Source was often cited in both the House and Senate hearings.

Carriers are currently allowed to sell customer data to their affiliates, agents and joint venture partners. As originally passed in the Telecom Act, phone companies were obligated to get an opt-in permission for the telcos to sell their information, but a court decision overturned that ruling.

Consumers are now obligated to opt-out of the arrangement.

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