• by Wendy Davis , May 16, 2025

The Consumer Financial Protection Bureau on Thursday withdrew proposed regulations that could have imposed new restrictions on data brokers' ability to disclose financial information for marketing purposes.

The original proposal, Protecting Americans From Harmful Data Broker Practices, was opposed by the industry group Privacy for America, which argued last month that the regulations “would harm consumers, the economy, and small businesses by hindering data services companies’ practices that provide valuable and desired offerings to the marketplace.”

Privacy for America members include the American Association of Advertising Agencies, Association of National Advertisers, Digital Advertising Alliance, Interactive Advertising Bureau and Network Advertising Initiative.

The proposed rules would have broadened the types of companies covered by the Fair Credit Reporting Act -- a 1970 law that prohibits “consumer reporting agencies” from sharing certain information about people's financial circumstances except for specific purposes, such as eligibility for credit or government benefits. The law also gives consumers the right to learn what's in their credit reports, and requires reporting agencies to correct or delete incorrect information.

Had the rules gone through, many data brokers that collect financial information -- including data about a consumer's income and financial tier -- would have been considered “consumer reporting agencies.”

Privacy for America argued to the agency that some of that financial data is used for marketing.

“Information regarding financial tier, for example, may be disclosed for marketing efforts for rideshare services, discount grocery stores, or luxury goods to efficiently target an audience most likely to purchase a product,” Privacy for America wrote.

Some privacy watchdogs had supported the proposal.

“Data brokers impose real harm on people by degrading privacy, security, and safety,” the Electronic Privacy Information Center and others wrote in comments submitted to the agency last month. They added that information held by data brokers can pose threats to national security, expose consumers to fraud and other threats.

The advocacy group Consumer Reports generally supported the potential rules, but expressed concern that they could override stronger privacy protections in states that already regulate data brokers. That organization had urged the agency to make clear that the potential changes don't cancel stronger state law.

The Consumer Financial Protection Bureau proposed the rules last December, during the Biden administration. Since then, the Trump administration has taken steps to roll back regulations.