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Texas probes four more car companies over how they collect and sell consumer data

Texas is investigating four additional car companies for deceptive trade practices relating to their data collection and sales practices, months after suing General Motors for allegedly handling drivers' data in a "false, deceptive and misleading" way.

Ford, Hyundai Motor America, Toyota Motor North America and Fiat Chrysler Automobiles U.S., which is owned by Stellantis, were sent letters by the Texas Attorney General’s Office earlier this month demanding sworn answers about how they collect, share and sell consumer data, according to public records obtained by Recorded Future News.

Texas Attorney General Ken Paxton has been aggressively pursuing automakers for their data collection and sales practices and filed a lawsuit against GM in August accusing it of pushing drivers to enroll in products that collected their data and then sold it to other firms.

The four automakers have been asked to produce information documenting their data collection methods; every third party they have sold data to or shared it with as well as whether they placed restrictions on how it could be used; the total number of customers and vehicles whose data was sold or shared; the processes used for receiving consumer consent to the data collection, sharing and sales; and the manner in which disclosures of the data practices were communicated to consumers.

The “sworn written statement” demand sent to Toyota specifically orders the company to answer questions about how it sells and shares data with Connected Analytic Services, LLC (CAS), which the company’s website says is an affiliate of Toyota Insurance Management Solutions USA, LLC.

CAS is Toyota’s “exclusive data aggregator, providing telematics and vehicle build data to insurance companies on behalf of Toyota customers who want to use their driving data to receive potential insurance savings,” according to the company’s website.  

Paxton also named several car companies in a lawsuit he filed January 13 against the insurance giant Allstate and its subsidiary Arity for allegedly unlawfully collecting and selling cell phone location and movement data for more than 45 million Americans.

That lawsuit alleges that several car manufacturers sold drivers’ data to Arity, a data broker which sold insurers the information to price premiums. Those car manufacturers are Toyota, Lexus, Mazda, Chrysler, Dodge, Fiat, Jeep, Maserati and Ram. They were not named as defendants in the complaint.

Last April, Paxton sent “civil investigative demands” to Kia, General Motors, Subaru and Mitsubishi seeking details of their data collection and sharing practices. 

General Motors is the only car company Paxton has sued over the data collection issue to date.

A ‘scrutinized’ industry

A spokesperson for Ford said in a statement that the company received a general inquiry in connection with Paxton’s probe of how car makers and other third parties collect and use “vehicle information”. 

The auto giant is cooperating with the inquiry, the spokesperson said. 

“Ford is committed to being a trusted steward of the personal information our customers choose to share with us and is confident that its practices are consistent with regulatory requirements and important privacy principles, including customer transparency and choice,” the statement said.

The automaker lets customers choose whether they share connected vehicle data with the company and allows them to turn vehicle connectivity off entirely, the statement said.

Ford also does not sell any connected vehicle data to data brokers, the statement said. The company previously shared data with insurers on behalf of customers who wanted usage-based insurance policies, the statement said, but decided last year to discontinue the practice.

The spokesperson noted that while the auto maker had entered into “exploratory partnerships with both LexisNexis [Risk Solutions] and Verisk, those exploratory agreements ended without launching any products and we never shared any connected vehicle data with them."

Texas’s lawsuit against General Motors alleges that the company sold data to those data brokers and also encouraged other automakers to sell data to LexisNexis Risk Solutions (LNRS) because it would earn royalty payments for each car company it recruited to participate.

The General Motors complaint also alleges that Hyundai inked a deal with Verisk to sell driver data. In May, Verisk said it had stopped accepting data from car companies.

The Federal Trade Commission (FTC) announced a proposed settlement agreement with General Motors and its OnStar subsidiary last week. The proposed agreement mandates that the auto giant stop sharing customers’ geolocation data with data brokers for five years and no longer misrepresent how it collects, uses and shares consumer data.

General Motors has said it stopped sharing consumer data with LexisNexis and Verisk last April. 

A spokesperson for Fiat Chrysler Automobiles U.S. declined to comment.

Spokespeople for Toyota and Hyundai, as well as the industry’s trade association, did not respond to requests for comment.

It is clear that Texas is investigating the auto industry’s data practices across the board, Cobun Zweifel-Keegan, the managing director for the Washington, D.C. office of the International Association of Privacy Professionals, said via email.

“Although Texas never announced an enforcement ‘sweep’ in the way that other AGs sometimes do, there is no hiding the fact that the entire vehicle industry is being scrutinized for its privacy practices related to geolocation and inferred driving data,” he said. “I would guess most manufacturers have heard from the Texas AG at this point.”

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Suzanne Smalley

Suzanne Smalley

is a reporter covering privacy, disinformation and cybersecurity policy for The Record. She was previously a cybersecurity reporter at CyberScoop and Reuters. Earlier in her career Suzanne covered the Boston Police Department for the Boston Globe and two presidential campaign cycles for Newsweek. She lives in Washington with her husband and three children.