The U.S. Consumer Financial Protection Bureau is investigating the payment services products marketed by big technology companies to understand how they monetize data on consumer behavior, the regulator said Thursday.
The CFPB said in a press release that it has ordered Google
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Apple
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Facebook
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Amazon
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Square
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and Paypal
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to “turn over information about their products plans and practices” with respect to their payment businesses.
“Payments businesses are network businesses and can gain tremendous scale and market power, potentially posing new risks and undermining fair competition,” CFPB Director Rohit Chopra said in a statement. “Knowing what we spend our money on is a valuable source of data on consumer behavior. This data can be monetized by companies that seek to profit from behavioral targeting, particularly around advertising and e-commerce.”
Chopra said that the market for payment services in China, dominated by Alipay and WeChat Pay illustrate the risks posed to consumers by tech giants in the U.S. wading into this space. These services “are deeply imbedded into the lives of the Chinese public, combining messaging, e-commerce and payment functionality into super-apps,” the regulator said. “In such a market consumers have little choice but to use these apps and little market power to shape how their data is used.”
The order comes amid increased scrutiny of allegedly anticompetitive practices by large tech companies in violation of federal antitrust statutes. Facebook and Google are both facing lawsuits brought by federal and state antitrust enforcers, while Apple and and Amazon could be affected by proposed antitrust legislation circulating in the House and Senate.
Facebook has also been in the spotlight following allegations by a former employee that the company deceived investors about its practices regarding hate speech, misinformation, and how its services impact the mental health of young users.
Though there is bipartisan support for new laws that target large technology platforms, Democrats in Congress have pushed for more sweeping legislation that would give federal regulators and private litigants more power to block anticompetitive practices in the courts, while Republicans have supported more targeted measures meant to reign in the power of social media platforms, including Facebook and Twitter
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