The Federal Trade Commission on Tuesday levied its first-ever fine involved in selling Internet and social media data against a company known as Spokeo. According to the FCC (News - Alert), the firm violated federal law in its compiling and selling of personal information gathered from Internet travel, which it then sold to potential employers screening job applicants.

The fine, levied at $800,000 dollars, came as the result of a settlement Spokeo agreed to without needing to admit the charges against them were true. Spokeo's marketing of personal data wasn't so much the issue, according to the trade commission, but rather that they sold data without ensuring that the data would be used for legal purposes.

Spokeo also failed to ensure that the data collected was accurate, and that the company failed to tell consumers about its own responsibilities as part of federal law.

Spokeo also created fake endorsements of its service, spreading them around a series of blogs and tech news sites, with the comments in question coming from Spokeo's employees. Spokeo, according to the commission, sold what the commission called "coherent people profiles," including potentially sensitive data like address – both physical and e-mail – as well as marital status, age, ethnicity, religion and more.

Spokeo, in turn, took to its corporate blog to announce changes to its practices to ensure they fell in line with protections offered by the Fair Credit Reporting Act, and were thereby brought up to standard. While under normal circumstances the FTC (News - Alert) can't levy fines, it can assess penalties under certain acts like the Fair Credit Reporting Act, and in a vote of four to zero, with one commissioner abstaining, to send the complaint to the Justice Department. 

Protecting the data of consumers is a necessity, as most consumers would likely agree. While it's easy to see why the human resource departments of the world would want access to the kind of data that Spokeo was offering, it still represents significant problems in its own right. The data in question may very well have facilitated any of a wide array of discrimination types, and it would have been wholly untraceable in the process. If a company knew things like age, ethnicity and religion ahead of an interview, it could have tailored its hiring processes accordingly to avoid any of those which it found "undesirable," which under normal circumstances would be illegal to do.

But since the issue would be not calling those people in for interviews in the first place, discrimination charges would have been virtually impossible to detect, let alone enforce, against the background of the standard selection process.

It's good to see that consumers are being afforded some measure of protection here, and hopefully the Spokeo case will ultimately yield further protections for regular consumers.