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Student Data Could Be Sold To Coke, Expert Warns On Capitol Hill

Students could have advertisements directed at them by Coca-Cola due to holes in existing privacy laws, one expert testified Wednesday during a House hearing on the data security of American schoolchildren.

Joel Reidenberg, who directs the Center on Law and Information Policy at Fordham Law School, told joint hearing of two House subcommittees that the privacy risks of growing digital efforts in education are grossly underappreciated.

The hearing, on the topic of “How Data Mining Threatens Student Privacy,” was shared between the Education Subcommittee on Early Childhood, Elementary, and Secondary Education and the Homeland Security Subcommittee on Cybersecurity, Infrastructure Protection and Security Technologies.

Reidenberg testified that school districts often lack awareness about just what information they are transmitting to third-party vendors. Student data, he said, isn’t just test answers but also information such as family financial status, lunchroom purchases, physical fitness records and more.

Only 7 percent of school contracts with third-party firms explicitly prohibit selling student data, he said, meaning there is ample opportunity for private firms to exploit student data.

Parents are typically left in the dark, since no law requires that they be informed about what data is being given to third parties. Not only are parents uninformed, though, but often schools are as well, since teachers and administrators often don’t comprehending just what they are turning over.

“[It's] very difficult to find anyone on staff who even [knows] what kind of outsourcing arrangements they [have,]” he said. He told Republican Rep. Todd Rokita of Indiana that smaller school districts in particular “seem to be winging it” when creating contracts with outside firms.

Currently, educational privacy is protected by the Family Education Rights and Privacy Act (FERPA), but that law was passed in 1974, well before the Internet age.

Reidenberg said the law is showing its age and an update is badly needed, since the law only applies to schools and only applies to educational records, while data such as a student’s height and weight isn’t covered. A new law should cover all student data and require mandatory disclosures to parents any time data was turned over, he said.

Without new legislation, Reidenberg warned that the innovative possibilities of technology could be derailed.

“There will be scandals, there will be problems,” he said. He cited the recent example of InBloom, a non-profit repository of student data that received over $100 million in funding but was forced to close due to privacy concerns from parents and legislators in several states. Tougher privacy laws, he said, would make parents more confident about data-driven ventures going forward.

Mark MacCarthy, a vice president of the Software and Information Industry Association, countered in his own testimony that fears of lost data are overblown and that no new legislation is needed. A great deal of market pressure already exists to make sure student data is not misused, he said. Companies that used student data for their own profit would “lose the confidence of their customers,” he said.

MacCarthy also warned that action by Congress end up hurting the U.S. economy in the long run.

“New legislation creates substantial risks of harm to the innovative use of information that is essential to improving education for all students and ensuring U.S. economic strength in an increasingly competitive global environment,” MacCarthy said. Efforts to protect privacy could put a “digital learning ceiling” on the use of data in education, he said.

Republican Rep. Pat Meehan of Pennsylvania asked MacCarthy whether current law was sufficient to protect his son from receiving targeted Coca-Cola advertisements based on data given out by the school. MacCarthy said that would be illegal due to existing government guidelines, but Reidenberg flatly disagreed. He said guidelines were not the same as binding regulation.

“The gaps are astounding,” he said, emphasizing that 25 percent of contracts between school districts and third party companies involved no fee for the school, with student data being the only payment. That data, he said, must be getting monetized.

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