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A. Reported violations of consumer laws (com- (1) Coordination of activities of participating con- NG. puterized).

sumer protection agencies.

(2) Reporting agency, place of violation, name of
business involved, whether investigation is
pending.

II. Nature of Material Submitted

Because the Federal Trade Commission's data relates to business entities and not to individuals, the respondent felt that records maintained were not of the sort contemplated by the questionnaire. Consequently, the subcommittee's questions were not answered directly. The response does provide a candid description of the FTC's system of data collection relating to offending business activities. However, since the FTC did not reply directly to the subcommittee questionnaire, many of the specific questions went unanswered, as will be indicated below.

III. Comments

A. Statutory Authority

The authority for the maintenance of a data bank as a means of coordinating the activities of consumer-related agencies was not provided in the FTC's response.

B. Subject Notification and Review

The response gave no indication as to whether listed businesses are given access to recorded data.

C. Access by Other Agencies

The purpose of the compilation of data is to provide participating federal and non-federal agencies with information so that the same challenged business will not be investigated by more than one agency. Interfacing was not treated in the FTC response.

D. Public Access

The response states only that a list of affected businesses is distributed to participating agencies. There is no indication whether an individual desiring information about a particular business would be allowed access to data.

E. Security Precautions

No information was provided as to security precautions.

F. Sources of Information

Data is provided by the various consumer protection agencies. IV. Evaluation

It was the opinion of the respondent that a summary answer was sufficient, because FTC files contain information having to do with businesses, and not individuals. A file of this sort probably is not pertinent to the subcommittee inquiry.

Agency Response

The Federal Trade Commission submitted an interim reply to the subcommittee's December 15, 1970, request for replies to the standard questionnaire (see inside back cover) on December 23, 1970. When the subcommittee had received no substantive reply by September 5, 1972, the subcommittee renewed its request for information. The Federal Trade Commission finally responded on October 5, 1972. All three letters appear below.

Hon. SAM J. ERVIN, Jr.,

FEDERAL TRADE COMMISSION, Washington, D.C., December 23, 1970.

Chairman, Subcommittee on Constitutional Rights, Committee on the Judiciary, U.S. Senate, Washington, D.C.

DEAR CHAIRMAN ERVIN: This will acknowledge your letter received December 15, 1970, requesting information concerning maintenance by the Commission of personal information data banks.

I have instructed the Commission's staff to assemble all information responsive to your request, and it will be forwarded as soon as possible. With kind personal regards,

Sincerely,

MILES W. KIRKPATRICK,

Chairman.

Hon. MILES W. KIRKPATRICK,

Chairman, Federal Trade Commission, Washington, D.C.

SEPTEMBER 5, 1972.

DEAR MR. CHAIRMAN: Other than your acknowledgement of December 23, 1970, the Subcommittee on Constitutional Rights has received no reply from the Federal Trade Commission in regard to its survey of federal data banks and individual privacy.

We are enclosing a copy of the original letter. Would you please describe all data banks containing personal information about individuals for statistical, administrative or intelligence purposes according to the survey questions attached. The Subcommittee is interested in a description of personal data banks and information systems maintained by the Federal Trade Commission in connection with FTC investigations, studies and hearings, and especially in personal information on individuals which is indexed and accessible or retrievable by name or other identifier, or in which linkage is possible between files of other agencies. The Subcommittee is also interested in computerized files maintained for administrative or statistical purposes.

In regard to access (Questions 9, 15 and 16), would you please indicate whether or not officials of any state or Federal agency have access to or use of any personal information you may acquire about individuals in other than aggregate form? If so, under what circumstances? For instance, would any law-enforcement or income tax official receive access to or data from your files?

We are now in the process of editing the survey material for publication and wish to fulfill the Subcommittee's obligations to the growing Congressional and public demand for such accounting by the Federal government by issuing our report promptly. I should appreciate your expediting your reply.

Sincerely yours,

SAM J. ERVIN, Jr., Chairman.

Hon. SAM J. ERVIN, Jr.,

Chairman, Subcommittee on Constitutional
U.S. Senate, Washington, D.C.

FEDERAL TRADE COMMISSION,
Washington, D.C., October 5, 1972.

Rights, Committee on the Judiciary,

DEAR MR. CHAIRMAN: In reply to your inquiry defining and requesting a report upon personal information data banks, it is concluded on the basis of a careful analysis of the recordkeeping practices of the Commission and its field offices that none of the data gathering operations of the Commission fall within the scope of your inquiry. This conclusion is based on the consideration that matters dealt with by the Commission are not intelligence oriented and concern business activities rather than personal activities.

To elaborate, I will explain the kinds, purpose of obtaining, and uses made of computer data relating to individuals which are collected by the Commission. As to the kinds of information thus collected, the Commission has no interest in the individual as such. Its interest in administering its antitrust and consumer programs centers solely on the business activities of the companies or individuals, and in investigating the business practices of an individual no attempt is made to accumulate personal histories or personal information.

The Commission currently collects and correlates computerized information in New York City and in San Francisco. In these areas reported violations of consumer laws are tabulated to indicate the Federal or nonfederal agency which reports them, the place of violation, the name of the business complained of, and whether an investigation is pending. This information is supplied by the Federal and nonfederal agencies in these areas which cooperate in the pooling of these data.

A purpose of the system is to coordinate the activities of participating consumer protection agencies in order that the same challenged business will not be investigated by more than one agency. Such coordination is intended to prevent unnecessary harassment of the businessman which would result from a multiplicity of actions by more than one agency, as well as to conserve the limited resources of investigating and prosecuting agencies. A further purpose is to limit the likelihood that a consumer complaint might receive no attention in the maze of protection activities which may be authorized to consider it. These objectives are met by listing, as described, the names of the business (individual or company as the case may be) involved in the consumer complaint and distributing the list to cooperating agencies.

Other uses are made of the computer analysis. The information enables local agencies and the Federal Trade Commission's regional offices in the two areas where data banks are maintained to assign priority to those businesses which are the object of more frequent complaints.

The letters of complaint against individual businesses received by the agencies which cooperate in the program are the raw material from which the limited information needed to supply the computer is extracted. The letters themselves remain undisclosed in the custody of the agency which receives them, and the receiving agency supplies for computerization only the basic data which are summarized by the computer. Further, requests for the names of businesses which may be in violation of consumer protection laws are denied unless they originate from a participating agency. The computer summaries furnished other agencies reflect only current situations as they are retained by them in their search files for only three months.

For a period of eighteen months, ending in March of this year, such computer operations were in operation in a number of other cities as well as New York and San Francisco, and the information summarized was similar to the data compiled under the present program, but considerably more detail was included. Budgetary considerations prompted reduction to the scale of operations now reflected in the present pilot program.

If you should wish further details of any of the Commission's recordkeeping activities, please advise me.

By direction of the Commission.

MILES W. KIRKPATRICK,

Chairman.

Attachments

The Federal Trade Commission submitted no attachments with its

response.

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ng and reviewing of new data banks and the clearance of new rd-management techniques?

rograms or the development of other comprehensive records sysother congressional committees by representatives from your been specifically approved by Congress or congressional com

you please supply any available testimony, or citations to such supply copies of any pertinent statutes and regulations cited in together with sample print-outs from each data bank.

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