Concerns about TikTok and social media’s handling of user data dominate the headlines, but a bigger issue often goes unnoticed: countless corporations quietly send private information about American consumers to foreign countries. Most Americans remain unaware that their medical records, financial information, and personal details are routinely stored and processed abroad, exposing them to significant privacy risks and making them easy targets for sophisticated fraudsters.
All U.S. consumer data—including that handled by banks, healthcare providers, and retailers—must be stored within the United States. This isn’t just a matter of convenience or cost; it’s essential for safeguarding privacy, preventing fraud, and rebuilding trust.
The Cost of Offshoring
Corporations prioritize cost savings over privacy, outsourcing sensitive consumer data to countries with weak or nonexistent protections. Every time you swipe a credit card, shop online, or file taxes with your CPA, your personal information may be stored and shared across borders.
The consequences are staggering. In 2023, the Federal Trade Commission (FTC) reported over $10 billion in fraud losses. Investment scams caused $4.6 billion in losses, while imposter scams accounted for $2.7 billion. The median loss per fraud victim was $500. Healthcare data breaches exposed over 133 million records, and AT&T’s breach compromised the personal information of 73 million customers.
Offshoring Data Creates Vulnerabilities
Imagine buying a laptop from Costco and activating Microsoft Windows. Within minutes, you receive a call from a scammer posing as Microsoft employees, asking for payment. Days later, another call claims your network is sending viruses to Microsoft, requiring a fee to fix. How did scammers get your precise details—your name, computer type, and purchase price? Because your data didn’t stay in the U.S. It traveled overseas, passing through international call centers and third-party vendors with lax privacy enforcement.
Data breaches aren’t the only way information ends up on the dark web. Many involve insider bad actors within outsourced operations who exploit access to your personal information, selling it for profit or directly to scammers.
Fraud’s Devastating Impact
Families lose life savings, elderly individuals are targeted for retirement scams, and no one seems immune to these sophisticated fraudsters. Real stories highlight the devastating impact:
- A widow from Illinois, lost nearly $1 million to a “pig butchering” scam, forcing her to sell her home and cherished belongings.
- A retired lawyer in Virginia, lost $740,000 in retirement savings to scammers posing as federal agents.
- An 80-year-old immigrant, lost over $700,000 to a fake cryptocurrency investment.
- A professional in New York, lost more than $800,000 from her retirement and investment accounts to sophisticated fraudsters.
Why Data Must Stay in the U.S.
Keeping consumer data on American soil ensures stronger oversight, accountability, and enforcement of privacy standards. U.S.-based companies can more thoroughly vet employees and face stricter legal consequences for mishandling information. This approach not only enhances security but also rebuilds consumer trust.
In contrast, offshoring data complicates oversight. While foreign countries may have privacy laws, enforcement is often weak, and U.S. authorities lack jurisdiction to act effectively. Insider threats are also harder to mitigate abroad, where access to sensitive data is less regulated.
Economic Impact and Consumer Empowerment
Storing all consumer data domestically could create hundreds of thousands of jobs in data management, cybersecurity, and related fields. It would foster a robust domestic data management industry, positioning the U.S. as a global leader in data protection.
Consumers can play a role by demanding transparency from companies about their data practices and supporting businesses that prioritize data security. They should also advocate for stronger data protection laws at both state and federal levels.
Regulating the Handling of Consumer Data
America needs comprehensive legislation requiring all U.S. consumer data to be stored domestically. This isn’t just about one platform or industry—it’s about protecting all personal information, from credit card numbers to medical records. Regulatory bodies like the FTC and the Department of Commerce should collaborate with Congress to establish and enforce stricter data security standards. The FTC could expand its oversight capabilities to audit corporations handling consumer data.
By keeping U.S. consumer data on American soil, we can minimize exposure to bad actors exploiting offshore vulnerabilities. Domestic data storage reduces the likelihood of breaches, insider threats, and unauthorized access, significantly lowering the risk of fraud. It’s time to prioritize the safety of Americans over corporate convenience.