The unauthorized processing of sensitive personal data has emerged as a topic that we hear about more now than ever. This is a result of our data being out there and the common saying that big tech knows more about us than we do. This has drawn intense scrutiny from state and federal regulators. We even heard from Josh Hawley recently attacking tech firms for all the sensitive data they have on us. From location data exposing intimate details about a person’s life to biometric information collected without consent, the misuse of sensitive data is prompting robust enforcement actions. As privacy laws evolve and public awareness grows, regulators like the Federal Trade Commission (FTC) and state attorney generals are cracking down on companies that fail to secure consent, signaling that this issue will remain a top priority for years to come.
The Stakes of Sensitive Data
Sensitive personal data—information that reveals details about an individual’s religion, sexuality, health, or identity—carries heightened risks when mishandled. Unlike generic data points, this information can lead to discrimination, identity theft, or personal harm if exposed. The processing of such data without explicit consent violates not only consumer trust but also a growing patchwork of privacy laws across the United States. Regulators are particularly focused on three areas: location data, biometric data, and children’s personal information.
FTC Targets Location Data Misuse
The FTC has taken decisive action against companies that collect and sell raw location data without consent. In recent cases, businesses have been found harvesting geolocation information that inadvertently disclosed consumers’ religious practices, sexual orientations, or visits to sensitive locations like medical clinics. For example, the FTC has pursued enforcement against data brokers who monetized this information that led to the creation of Daniel’s Law in New Jersey, arguing that such practices deceive consumers and violate privacy protections under the FTC Act. These actions underscore the agency’s stance that unchecked data collection poses unacceptable risks to individuals.
State-Level Enforcement: Texas and Beyond
State attorney generals are also stepping up, with Texas leading notable efforts. In the Lone Star State, regulators have targeted companies for collecting biometric data—such as facial recognition or voiceprints—without obtaining informed consent. Texas law, including the Capture or Use of Biometric Identifier Act (CUBI), imposes strict rules on biometric data handling, and violations have led to lawsuits and fines. Beyond biometrics, state regulators nationwide are addressing the collection and sale of children’s and teens’ personal information, often in violation of the Children’s Online Privacy Protection Act (COPPA), as well as the unauthorized use and sale of location data. These cases highlight a broader trend: states are filling gaps left by federal regulation with aggressive enforcement.
Why Consent Matters
At the heart of these actions is the principle of consent. Regulators argue that consumers must have clear, informed control over how their sensitive data is collected and used. Without it, companies risk not only legal penalties but also serious loss of trust and goodwill brand damage. The FTC and state attorney generals are sending a clear message: failing to prioritize consent isn’t just a compliance failure—it’s a betrayal of consumer rights. Penalties can include multimillion-dollar fines, injunctions, and mandatory data deletion, making the stakes higher than ever.
Notable Enforcement Examples
Recent cases illustrate the intensity of this crackdown. In 2023, the FTC settled with a major data broker for $1.5 million after it sold location data tied to consumers’ visits to reproductive health clinics, a move deemed exploitative post-Roe v. Wade. In Texas, the attorney general sued a social media giant in 2022 under CUBI, alleging it collected facial recognition data from millions of users without consent, resulting in a $650 million settlement. Meanwhile, California and New York have targeted ad tech firms for harvesting children’s data via online games, securing injunctions and penalties under COPPA. These high-profile actions serve as warnings: regulators are watching, and the financial and legal consequences are steep.
Emerging Technologies and New Risks
The rise of privacy enhancing technologies (PETs) as well as other advanced technologies amplifies these concerns. Artificial intelligence (AI), for instance, can infer sensitive traits—like mental health status or political beliefs—from seemingly innocuous data, such as browsing habits. Biometric systems, now embedded in everything from smartphones to retail security, collect fingerprints or iris scans at scale, often without users fully understanding the implications. Location tracking, fueled by apps and IoT devices, has become so precise that it can map a person’s daily life down to the minute. Regulators are racing to address these innovations, but enforcement often lags behind adoption, leaving gaps that unscrupulous companies exploit.
Compliance Strategies for Businesses
For companies, navigating this landscape requires proactive steps. First, adopt a consent-first approach: use clear, opt-in mechanisms that explain data use in plain language, avoiding vague “accept all” buttons. Second, conduct regular data audits to map where sensitive information flows—location logs, biometric records, or children’s profiles—and ensure compliance with laws like GDPR, COPPA, or state statutes. Third, limit data collection to what’s necessary, a principle known as data minimization, reducing exposure if a breach occurs. Finally, engage legal and privacy experts to draft robust Data Processing Agreements (DPAs) with vendors, ensuring downstream accountability. These measures not only mitigate risk but also build consumer trust—a competitive edge in a privacy-conscious market.
Broader Implications
The crackdown on sensitive data misuse reflects a cultural shift. Consumers are demanding transparency, spurred by headlines about data scandals and breaches. Businesses that ignore this trend face not just fines but boycotts and brand erosion. Conversely, those that prioritize privacy can differentiate themselves, appealing to a growing segment of privacy-savvy users. For regulators, the challenge is balancing enforcement with innovation—cracking down on bad actors without stifling tech development. States like Texas, with their proactive stance, may inspire a national framework, though political gridlock in Congress suggests a federal privacy law remains distant. Until then, the patchwork of state and federal actions will shape the landscape.
Sensitive Data FTC Regulation Software
While we provide software that can automate your FTC sensitive data requirements we would love to know more about your data practices to help guide you. The focus on sensitive data isn’t fading anytime soon. As technology advances—think AI-driven profiling or expanded biometric applications—so do the opportunities for misuse and the need for privacy software to keep your business out of the crosshairs of the government and litigation happy law firms that use old laws like CIPA which was created before the internet as a way to sue for damages related to misuse of sensitive data. The FTC’s actions against location data brokers and states’ crackdowns on biometric and children’s data violations suggest a future of tighter regulations and more enforcement. Companies handling sensitive data must act proactively: secure explicit consent, audit data practices, and align with laws like GDPR, COPPA, or state-specific statutes. For consumers, these efforts offer hope that their most personal information won’t be exploited without their knowledge.
