Federal bankruptcy proceedings involving sensitive personal data have the attention of the Federal Trade Commission (FTC), CNET News reports. The FTC recently sent a letter to creditors and attorneys involved in the case, warning that the sale, transfer or use of the information involved could violate federal law. The owner of the defunct Web site XY, which catered to gay young men, filed for bankruptcy protection earlier this year, listing as assets the XY customer list and personal data. Ari Schwartz of the Center for Democracy and Technology said it would make sense for the bankruptcy judge to appoint a consumer privacy ombudsman to this case.
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