General Motors to pay $12.75 million in California driver privacy settlement

Settlement Terms

General Motors has reached a privacy-related settlement with a group of law enforcement agencies led by California Attorney General Rob Bonta. The Detroit-based automaker has agreed to pay $12.75 million in civil penalties to resolve the matter. According to Law360, this represents the largest penalty imposed to date under California's data privacy law.

As part of the agreement, which is subject to court approval, GM must stop selling driving data to any consumer reporting agencies, including data brokers, for a period of five years. Specifically, the settlement names data brokers Lexis and Verisk as entities to which GM must cease selling this information. Additionally, the company is required to delete any driving data within 180 days.

Allegations of Illegal Data Sales

The settlement follows a California consumer protection lawsuit and investigation into allegations that GM illegally sold detailed information about the driving habits of hundreds of thousands of Californians. Prosecutors alleged that the automaker secretly collected and sold drivers' personal data through its OnStar system without providing proper disclosure or obtaining consent.

The data in question included drivers' behavior and location data. Reports indicate that General Motors made approximately $20 million from these sales.

Regulatory Context and Impact

Attorney General Rob Bonta stated that the settlement represents the Department of Justice's first action enforcing the principle of data minimization. Bonta further noted that California drivers would not see increased insurance premiums as a result of GM's sales of this data.

The investigation focused on the legality of transferring detailed driving habits to third-party brokers. The resulting penalties and restrictions on data sales aim to ensure consumers remain "in the driver's seat" regarding their personal data privacy.