The federal government wants to know exactly what big tech companies are doing with all the personal information they’re collecting from users of their payment services.
The Consumer Financial Protection Bureau (CFPB) is ordering tech giants Amazon, Apple, Facebook, Google, PayPal, and Square (CashApp) to turn over information on their business practices, including whether they might engage in invasive surveillance of consumers in order to sell user information to third parties or use it for price discrimination, the bureau said Thursday. It also said it would study Chinese-owned payment services Alipay and WeChat.
The tech companies’ recent efforts to expand their payment offerings caught the regulator’s eye. PayPal launched a “super app” last month that combines payments, shopping, cryptocurrency transactions, and other functions, for example. Retail giant Amazon recently launched a “pay by palm” system for brick-and-mortar merchants, as well as a buy-now-pay-later option for its online store. This week, Facebook launched a pilot of Novi, a digital wallet that lets users send and receive money abroad.
“Big Tech companies are eagerly expanding their empires to gain greater control and insight into our spending habits,” CFPB Director Rohit Chopra said in a statement. “We have ordered them to produce information about their business plans and practices.”
The investigation of big tech practices was welcomed by some consumer advocate groups, who’ve long criticized tech companies’ use of private information from users.
“Today’s CFPB action is big for many reasons,” the Open Markets Institute, an anti-monopoly advocacy group, wrote on Twitter. “Just as tech firms are expanding consumer-facing financial services, these orders legally compel transparency about how exactly the firms are monetizing data they collect about how we spend our money.”
Have a question, comment, or story to share? You can reach Diccon at firstname.lastname@example.org.