General Motors (GM) has agreed to a $12.75 million settlement with California authorities following allegations that the automaker covertly monetized the driving habits of hundreds of thousands of residents. The settlement, led by California Attorney General Rob Bonta, addresses the unauthorized collection and sale of sensitive consumer information to third-party data brokers.
The Data Pipeline: From OnStar to Data Brokers
The investigation revealed that GM utilized its OnStar telematics program to harvest a wide array of personal information. This included names, contact details, precise geolocation data, and specific driving behaviors.
According to the Attorney General’s office, GM sold this information to Verisk Analytics and LexisNexis Risk Solutions, generating approximately $20 million in revenue. Despite public assurances regarding consumer privacy, the state alleged that GM shared this data without obtaining meaningful consent from its customers.
California’s Unique Consumer Protections
While a 2024 report by the New York Times highlighted how similar data sales led to spiked insurance premiums for drivers in other states, California residents were largely shielded from the financial fallout. Under California insurance law, providers are strictly prohibited from using driving behavior data to set individual rates. As a result, while their privacy was compromised, their monthly premiums remained stable.
Settlement Terms and Future Restrictions
Beyond the $12.75 million in civil penalties, the agreement imposes several strict mandates on GM:
- Five-Year Ban: GM is prohibited from selling driving data to consumer reporting agencies for the next five years.
- Data Deletion: The company must delete all retained driver data within 180 days unless explicit customer consent is obtained.
- Broker Accountability: GM is required to formally request that LexisNexis and Verisk delete the previously purchased data.
This action follows a prior settlement with the Federal Trade Commission (FTC), which also resulted in a ban on selling specific consumer data. In response to the California settlement, GM noted that it discontinued its “Smart Driver” feature in 2024 and is committed to strengthening its privacy frameworks moving forward.
