FCC Steps Into Data Privacy Fray With Action Against Telecommunications Company

The Federal Communications Commission took its first step into the field of data security regulation on October 24 when it hit two telecommunications companies with a $10 million fine for allegedly failing to adequately safeguard customers' sensitive information.

The two companies – TerraCom, Inc. and YourTel America, Inc. – were fined for allegedly placing the personal data of up to 300,000 consumers at risk by storing Social Security numbers, names, addresses, driver's license ID numbers, and other sensitive information on unprotected Internet servers that "anyone in the world" could access.

The FCC's action is unique as the Federal Trade Commission traditionally has been the governmental agency regulating privacy issues, including filing more than 50 data security cases in the past decade.