The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) canceled a contract with Penlink that used ad-surveillance technologies to track the location of Americans.

The contract was canceled a little more than a month after ATF Director Robert Cekada acknowledged under questioning from Rep. Michael Cloud, R-Texas, in a congressional hearing that the agency was purchasing the geolocation data of Americans through a contract for “an ad-tech type thing” that would provide the agency with geolocation data “based on the ads that go through.”

 “We have purchased access to that system but we have not used it for a criminal case because we have not established any policies yet on how we would do it,” Cekada said.

He described that system and data as novel and said ATF was still determining how to craft official guidance for how agents would use it in investigative work.

In an email, an ATF spokesperson confirmed to CyberScoop that the contract had been canceled, describing it as a limited pilot project for capabilities the agency was no longer seeking.

”ATF continually evaluates tools and techniques to enhance our investigations and ultimately reduce violent crime in American communities,” the spokesperson wrote. “We did conduct a pilot with Webloc to determine if it could improve our investigative capabilities. After completing our review, we determined the tool does not meet our needs and cancelled the contract. ATF is not currently using any other ad-tech-sourced services.”

According to Sen. Ron Wyden, D-Ore., he requested and his staff received a briefing from ATF on the matter on June 12. In the meeting, Cekada identified purchasing licenses for Penlink’s Webloc commercial location surveillance tool as the contract in question.

Further he said the ATF had already conducted more than 340 searches using the system, including more than 222 that were directly tied to active ATF case numbers.

On its website, Penlink describes itself as an open-source intelligence analysis platform that provides real time data collection, forensic and web analysis and digital evidence collection. The firm touts its use of “AI-driven analysis” to increase case resolution rates by 80% as well as the ability to “tie disparate data together to one subject, place, or group using comprehensive identity resolution capabilities.”

Wyden, who earlier this year led a group of 70 congressional Democrats calling for an investigation into the purchase of commercial location data by Immigration and Customs Enforcement, said that ATF ultimately did “the right thing” but called for Congress to pass his legislation that would change the practice throughout the federal government.

“After Representative Cloud and my staff informed the ATF about the legal and privacy quagmire surrounding adtech data,  the agency did the right thing,” Wyden said in a statement. “Canceling this contract is a victory for Americans’ constitutional rights, but Americans’ privacy shouldn’t depend on ad hoc congressional interventions. Congress must pass the Government Surveillance Reform Act to close the data broker loophole once and for all.”

Wyden’s office noted that the purchase of ad-tech geolocation data is illegal in some states, and that the Federal Trade Commission has already established that selling sensitive location data to government agencies and contractors falls under deceptive and unfair practices under the FTC Act.

The use of ad-tech to surveil and geolocate targets online is a growing problem. While such tools are commonly used by marketing and advertising agencies to send targeted ads based on geography or region, bad actors can also use use to unmask the identities or locations of individuals, or combine them with other public data in ways that worry privacy advocates. A University of Tennessee student is suing a company based in the Virgin Islands for pulling videos from her social media, turning them into nonconsensual ads for their dating service and then using ad-tech geolocation to serve the ads to men online near her.

Wyden’s office said in one instance, the tool was used to get location data for devices associated with a defense contractor at the same time as a suspected arson incident, but that the ATF later backed off from using it in court after both the prosecutor and judge expressed “serious discomfort with the use of warrantless adtech data.” The ATF ultimately opted to seek a court order for bulk cell phone tower data instead.

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