FCC proposes fining U.S. wireless carriers more than $200 mln over consumer location data

By David Shepardson

WASHINGTON (Reuters) - The Federal Communications Commission confirmed on Friday it voted to propose fining four major U.S. wireless carriers more than $200 million for failing to protect consumers' location information.

The FCC is proposing to fine T-Mobile US Inc (NASDAQ: TMUS) more than $91 million, AT&T Inc (NYSE: T) $57 million, Verizon Communications Inc (NYSE: VZ) $48 million and Sprint Corp (NYSE: S) more than $12 million.

T-Mobile said it would dispute the fine, saying that after it learned its "location aggregator program was being abused by bad actor third parties, we took quick action." The other three carriers did not immediately comment.The carriers will get to challenge the proposed fines before they can become final. Reuters first reported on Thursday that the total of the fines was expected to be just over $200 million.

FCC Chairman Ajit Pai said the commission "took decisive action to protect American consumers and we are confident in the balance we struck."

The FCC said in May 2018 it was investigating reports that a website flaw could have allowed the location of mobile phone customers to be tracked. That probe expanded into other uses of consumers' location data by third-party firms.

Carriers have allowed the use of location-data for programs like roadside assistance, logistics, medical emergency alert services, human trafficking alerts and fraud prevention.

FCC Commissioner Jessica Rosenworcel dissented from the determination, saying in a statement that the investigation was "a day late and a dollar short. The FCC kept consumers in the dark for nearly two years after we learned that wireless carriers were selling our location information to shady middlemen."

She said the FCC did not impose large enough fines given the violations.

The FCC said carriers relied on contract-based assurances that service providers would obtain consent from carriers' customers before accessing location information.

A trade group representing U.S. wireless carriers said in January that "upon hearing allegations of misuse of the data, carriers quickly investigated, suspended access to the data and subsequently terminated those programs."

Lawmakers last year expressed outrage that aggregators were able to buy user data from wireless carriers and sell "location-based services to a wide variety of companies" and others, including bounty hunters.

FCC Commissioner Geoffrey Starks said the commission should have issued subpoenas to determine how many consumers were impacted.

(Reporting by David Shepardson; Editing by Chris Reese, Steve Orlofsky and Daniel Wallis)

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