GM banned from sharing driving and location data with insurance companies

We regularly hear stories about companies that sell your sensitive personal data — including information about your location — to the best bidder. The latest culprit appears to be General Motors.

The Federal Trade Commission claims that GM and Onstar – GM subscription in the vehicle safety and security system – collected, used and sold precise driver geolocation and driving behavior information from millions of vehicles without properly notifying consumers and obtaining their consent.

On Thursday, the agency issued a proposed order prohibit the company from selling such data to consumer reporting agencies for five years.

In its complaint, the FTC alleged that GM used a “deceptive enrollment process” to get consumers to sign up for Onstar. Some users said they were unaware they had signed up for Onstar’s Smart Driver feature, which promised to use driving data to help drivers improve their vehicles’ performance and encourage safer driving.

“GM tracked and sold precise people’s geolocation data and information about driver behavior, sometimes as often as every three seconds,” FTC Chairwoman Lina M. Khan said in a statement.

This is the latest problem that has plagued the car manufacturing giant in recent weeks. last month, GM turned it off on financing the autonomous vehicle unit of Cruise, a company in which GM has invested more than $10 billion.

A settlement with the FTC follows on Thursday Kashmir Hill investigation by The New York Timeswhich revealed that GM collected details of its customers’ driving habits – including every instance of sudden braking, late-night driving and speeding – and sold the records to insurance companies and third-party data brokers. The result was that drivers started seeing higher insurance premiums, but couldn’t figure out why.

The potential misuse of customer data goes beyond raising insurance premiums. A person’s geolocation data can reveal the most intimate details of a person’s life, including where they live and work and whether they have visited a medical facility or place of worship. In the wrong hands, location data poses a serious danger to, for example, abortion seekers across the country.

As part of the FTC’s proposed order — if approved by the court — GM and Onstar will be prohibited from disclosing information to consumer reporting agencies and will also be required to obtain express affirmative consent from consumers before collecting any vehicle data in the future. The automaker should also allow customers to obtain and delete their data, as well as limit the collection of data from their vehicles.

Because it is still a proposed order, the agreement will be subject to a 30-day public comment period before a final decision takes effect.

TechCrunch has reached out to GM and the FTC for additional information and will update if we hear back.