Can Big Data Lead to Big Legal Problems For Companies?

Big data is used in virtually every industry to improve consumer relations, create workforces, and improve company operations. Algorithms can be created to pull specific types of data based upon answers to survey questions, click-throughs, and link follows. Companies have to be careful with what data they collect and how it's collected – while the data may be important to them, they might be breaking laws.

Potential for Discrimination
Companies must be aware of how their algorithms are written before launching a data collection campaign. It is best to randomize the data collected with less than ten common factors. The common factors would be the specific pieces of data the company wants. By randomizing whom the data is collected from, it is impossible to target a specific demographic group.

In many cases, companies are not aware that they are breaking any laws by collecting data. Big data is the future and every company needs to leverage it for growth, improved marketing, and improved consumer experiences.

Ethically Fair Collection Practices
It is nearly impossible to prove that a company has intentionally created an algorithm that segregates collection to negatively influence a specific ethnic group. Inputting commands into a computer is not always accurate. Some types of data collection do segregate responses intentionally, but are covered up by grouping that data with randomly collected pieces of common data.

Equal Opportunity Infractions
Several equal opportunity infractions could result from big data collection in a warning from the Federal Trade Commission. Violations to the Equal Credit Opportunity Act could occur if a lender refuses to offer a loan to one singled out person with higher interest rates because married people are more likely to pay debts.

Fair Credit Reporting Act Infringements
Infringements regarding the Fair Credit Reporting Act can be valid when a financial institution, lender, or finance company uses data to extend offers to a specific type of client only. Clients that do not fit a specific group, based on the way the collection algorithm was written, would be offered unfavorable options that are harder to pay down. This is an infringement of the Fair Credit Reporting Act, which can result in fines and/or personal damage settlements.

Incorrect Algorithms
Using incorrect algorithms in any industry, returns inaccurate results. Attorneys can use big data to search for common types of cases. Something that a personal injury attorney can use big data for is searching common outcomes, case strategies, and case similarities to strengthen a current case.
Companies using incorrect algorithms can actually end up becoming ethically incorrect. What this means is that demographic groups may be excluded from data collection based upon a series of answers. It also means that other ethnic groups could be singled out for data collection if a company has a specific brand goal to achieve.

Personal Privacy Infringement
Employers are able to use big data to predict or uncover pregnancies in female employees. Knowing the likelihood of a female to become pregnant based upon factors collected from online searches on work machines, work habits, and life cycle may help an employer know when to have temporary staff in place. This is completely legal – but some question its ethicality.

Many women consider their employer prying secretly using big data to track employee pregnancies or sneakily obtain information about a woman's intention to become pregnant as an invasion of privacy.

Education Discrimination Potential
Based upon the way that students search for information, information to some students may not be immediately available. This is due to the way that education companies categorize big data and create algorithms. A student looking for financial assistance with high-test scores may not be made aware of important opportunities for assistance due to having high test scores. Education discrimination is hard to prove as being intentional, but can still break a law.

Closing Thoughts on Potential Big Data Legal Problems
Before using big data to reach a specific goal with your company, research the legality of the type of collection you wish to implement. It is ideal to consult the company's legal staff prior to launching data collection algorithms. Breaking a law can result in heavy penalties and the destroying of the data collected. Monitoring of your data collection practices could also take place.