It’s a modern-day truism that when you use a “free” online service, you’re still paying – not with your money, but with your personal information. This is simply the reality for many of the services we’ve come to rely on in our daily lives, and for most it’s an acceptable (if sometimes creepy) bargain.

But what if you’re paying for online services not just with your own personal information, but with that of your friends and family? And what if the information you’re handing over is being shared with others who might use it for purposes you didn’t consider when you signed up – maybe for research purposes, maybe to advertise to you, or maybe even to influence the way you vote?

Last week it emerged that an organisation called Cambridge Analytica may have used personal information scraped from Facebook to carry out targeted political advertising. The information was obtained when Facebook users accessed a psychometric profiling app called thisisyourdigitallife – but the data that was collected wasn’t just about app users, it was also about their Facebook friends (more on that below).

It’s what we’re now seeing from consumers that’s interesting.  People are rightfully asking for an explanation. Whilst we seem to have been asleep at the wheel over the last few years, as data empires around the world have pushed the boundaries, the current Facebook debacle is leading us to ask questions about the value of these so-called “free” services, and where the lines should be drawn.  The next few weeks will be telling, in terms of whether this really is the “tipping point” as many media commentators are calling it, or just another blip, soon forgotten.

In any case, with only a few months until the EU General Data Protection Regulation (GDPR), comes into force, this blog post asks:  If GDPR was operational now, would consumers be better protected?

First, some background

There’s plenty of news coverage out there covering the details, so we’ll just provide a quick summary of what happened.

A UK-based firm called Global Science Research (GSR) published thisisyourdigitallife and used the app to gather data about its users. Because GSR claimed this data was to be used for academic purposes, Facebook policies at the time allowed it to also collect limited information about friends of app users. All up, this meant that GSR collected the personal information of more than 50 million people – many more than the 270,000 people who used the app.

GSR then used the personal information to create psychometric profiles of the included individuals, apparently without their informed consent. These profiles were then allegedly passed on to Cambridge Analytica (possibly in breach of Facebook’s rules), which used the data to target, market to – and perhaps manipulate – individuals.

Was this a breach?

There’s been some debate over whether this incident can be fairly labelled a “breach”. Based on what we know, it certainly doesn’t appear that any personal information has been lost or disclosed by means of an accident or a security vulnerability, which is something many consider a necessary element of a “data breach”.

Facebook’s initial response was to hit back at claims it was a “data breach”, saying users willingly handed over their information, and the information of their friends. “Everyone involved gave their consent. People knowingly provided their information, no systems were infiltrated, and no passwords or sensitive pieces of information were stolen or hacked” it allegedly said.

Facebook has since hired a digital forensics firm to audit Cambridge Analytica and has stated that if the data still exists, it would be a “grave violation of Facebook’s policies and an unacceptable violation of trust and the commitments these groups made.”

In more recent days, Mark Zuckerberg has made something of a concession, apologising for the  “major breach of trust”.   We love this line from the man that told us that privacy is dead.

GDPR – would it have helped?

We at elevenM are supporters of the GDPR, arguably the most extensive and far reaching privacy reforms of the last 25 years. The GDPR raises the benchmark for businesses and government and brings us closer to one global framework for privacy.   But would the GDPR have prevented this situation from occurring? Would the individuals whose data has been caught up by Cambridge Analytica be in a better position if the GDPR applied?

Let’s imagine that GDPR is in force and it applies to the acts of all the parties in this case, and that Facebook still allowed apps to access information about friends of users (which it no longer does). Here is the lowdown:

  1. Facebook would have to inform its users in “clear and plain” language that their personal information (aka personal data under GDPR) could (among other things) be shared with third party apps used by their friends.
  2. Because the personal data may have been used to reveal political opinions, users would likely also need to provide consent. The notification and consent would have to be written in “clear and plain” language, and consent would have to be “freely given” via a “clear affirmative act” – implied consent or pre-ticked boxes would not be acceptable.
  3. The same requirements relating to notification and consent would apply to GSR and Cambridge Analytica when they collected and processed the data.
  4. Individuals would also have the right to withdraw their consent at any time, and to request that their personal data be erased (under the new “right to be forgotten”). If GSR or Cambridge Analytics were unable to find another lawful justification for collecting and processing the data (and it’s difficult to imagine what that justification could be), they would be required to comply with those requests.
  5. If Facebook, GSR or Cambridge Analytica were found to be in breach of the above requirements (although again, this is purely hypothetical because GDPR is not in force at the time of writing), they could each face fines up to 20 million EUR, or 4% of worldwide annual turnover (revenue), whichever is higher. Those figures represent the maximum penalty and would only be applied in the most extreme cases – but they make clear that GDPR is no toothless tiger.

So, there it is.  We think that GDPR would have made it far more likely that EU residents were made aware of what was happening with their personal data and would have given them effective control over it.

Some lessons

With so many recent data incidents resulting from outsourcing and supply chain, regulators around the world are focussing increasingly on supplier risk.  Just last week here in Australia, we saw the financial services regulator APRA’s new cyber security regulation littered with references to supplier risk.   The Cambridge Analytica situation is another reminder that we are only as strong as our weakest link.  The reputations of our businesses and the government departments for whom we work will often hinge on the control environments of third parties.  Therefore, organisations need to clearly assess third party risks and take commensurate steps to assure themselves that the risks and controls are reasonable and appropriate.

As for individuals – regardless of what regulatory action is taken in Australia and abroad, there are simple steps that we all can and should be taking.  This episode should prompt people to think again about the types of personal information they share online, and who they share it with. Reviewing your Facebook apps is a good start – you might be surprised by some of the apps you’ve granted access to, and how many of them you’d totally forgotten about (Candy Crush was so 2015).

What’s next

We expect this issue to receive more attention in the coming weeks and months.

Regulators around the world (including the Australian Privacy Commissioner, the UK Information Commissioner (ICO), the Canadian Privacy Commissioner and the EU Parliament) are looking into these issues now. Just over the weekend we saw images of ICO personnel allegedly raiding the premises of Cambridge Analytica, Law & Order style.

The Australian Competition and Consumer Commission (ACCC) also has been preparing to conduct a “Digital Platforms Inquiry” which, among other things, may consider “the extent to which consumers are aware of the amount of data they provide to digital platforms, the value of the data provided, and how that data is used…”

Meanwhile, we await the consumer backlash.  Consumers will likely expect increasingly higher standards from the organisations they share their data with and will seek out those organisations that are transparent and trustworthy, and which can demonstrate good governance over privacy and data protection practices.   Will you be one of them?