Private Car Scanning License Plates: Are Your Privacy Rights at Risk?

Local governments in Connecticut have been utilizing vehicle registration compliance programs for years to ensure that vehicle owners are correctly registered and paying their fair share of local taxes. These programs, designed to recoup lost revenue, have recently come under scrutiny from privacy advocates. The concern revolves around the methods employed, particularly the use of Private Car Scanning License Plates, which some experts argue may pose significant risks to personal data and potentially undermine state privacy protections.

These motor vehicle compliance initiatives operate by contracting private firms to investigate vehicle registrations. The goal is to identify instances where drivers might be registering their vehicles in incorrect jurisdictions to avoid local taxes or exceeding the allowed grace period after moving to a new location. To achieve this, these private companies employ dash-mounted automatic license plate readers (ALPRs). These systems are used to collect license plate numbers and geolocation data, which is then cross-referenced with extensive personal information databases to verify vehicle ownership and residency.

The scale of these operations is considerable. Investigative firms involved in this practice routinely examine thousands of vehicles and their owners. Their compensation is often tied to a percentage of the recovered revenue, creating a strong incentive to maximize findings. This process involves the collection, processing, and storage of vast amounts of data, often with limited public oversight. Investigations can extend over several months, potentially building a detailed “pattern of life” for individuals. Privacy experts warn that this accumulation of personal details, if exposed in a data breach, could lead to risks that outweigh the intended benefits of these programs.

Danbury’s 8,000+ Vehicle Investigations

Danbury, Connecticut, exemplifies this trend. The city’s assessor’s office initiated a motor vehicle compliance program in November 2022 to recover tax revenue lost due to improper vehicle registrations. They contracted Capital Tax Recovery, a private investigative company, to carry out this task.

Donna Murphy, Danbury’s assessor, explained that while she couldn’t detail Capital Tax Recovery’s specific methods, the city’s official website indicates that the firm is “scanning license plates throughout the City to determine if all residents do indeed have their vehicles registered with the State of CT and have Danbury as their tax town.” Despite requests for comment, Capital Tax Recovery did not respond to inquiries about their practices.

Previous reports, such as one by Connecticut Inside Investigator, have shed light on the methods used by firms like Municipal Tax Services, another private company operating in this sector. These reports detail how agents systematically drive through every street within a municipality multiple times. They utilize dashboard-mounted camera systems, SecureWatch24, to record each license plate, along with the time, date, and GPS location. In situations where vehicles are parked in long driveways, agents reportedly use binoculars to capture license plate data, again recording the time, date, and location.

The data collected through these scanning activities is then compared against municipal motor vehicle grand lists, which are records of taxable property. In Danbury’s case, the 2022 grand list included 72,069 vehicles. According to Assessor Murphy, if a license plate is scanned in Danbury more than twice and the vehicle is not already on the grand list (indicating it’s not registered in Danbury), the vehicle becomes subject to investigation by Capital Tax Recovery. Capital Tax Recovery’s website states that the investigative period for determining vehicle ownership and residency is approximately 90 days. By mid-November, Danbury alone had over 8,345 vehicles under investigation by the firm.

The “Pattern of Life” and Privacy Implications

Connecticut is among a minority of states with comprehensive consumer data privacy laws. The Connecticut Data Privacy Act, which took effect in July, grants consumers rights concerning their data, including the right to know what data is collected, to correct inaccuracies, to request deletion, and to opt out of data collection. However, the law includes exemptions for government agencies and their vendors, potentially creating a loophole for these private car scanning programs.

Elizabeth Benton, spokesperson for the Connecticut Attorney General’s Office, clarified that exemptions exist for non-consumer data collection related to government functions. She argued that license plates fall under this exemption as they are publicly displayed. However, Tom Aldrich, Vice President of Private Clients at the digital risk firm 360 Privacy, raises concerns about combining vehicle and owner data with geolocation information.

“What that firm is doing is they are legitimately developing a ‘pattern of life’ on you,” Aldrich stated. “All of the data points that are collected are essentially telling the government of the state of Connecticut, ‘This is who this person is, this is what they drive and this is where they go over the course of a 90-day period.’” He emphasizes the detailed picture that emerges from this data collection, revealing personal habits and movements over time.

Aldrich further argues that these programs contradict the spirit of Connecticut’s Data Privacy Act. While the firms may be exempt due to their government contracts, the consumer data database they create would typically fall under the privacy law’s purview. He points out that the law aims to foster transparency and empower individuals to make informed decisions about their data, rights that seem to be undermined by these private car scanning practices.

Data Collection for Profit

Danbury Assessor Murphy confirmed that the city’s contract with Capital Tax Recovery, initially for one year, has been renewed for another year. The firm receives 40% of the additional tax revenue generated from their investigations, meaning the program operates at no direct cost to the city.

Municipal Tax Services, on their website, claims to have assisted 10 municipalities, assessed over 40,000 vehicles, and generated $20 million in tax revenue. Murphy stated that Danbury itself brought in $137,000 this year after compensating Capital Tax Recovery.

While Murphy defends the program as a means to ensure “people who don’t have their vehicles registered to pay their fair share of taxes,” Aldrich’s concerns center on potential government overreach. He questions the public’s perception if they witnessed someone parked outside their home with binoculars, collecting data. Aldrich suggests that these private companies appear to have excessive freedom to collect data under the guise of government work, raising fundamental questions about privacy and oversight in the pursuit of tax revenue. The debate highlights the tension between efficient tax collection and the growing importance of protecting personal privacy in the digital age, especially concerning private car scanning license plates.

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