The House Committee on Energy and Commerce launched an investigation into 23andMe’s bankruptcy filing on April 17, 2025, amid mounting concerns over the security of genetic data belonging to over 15 million customers. This probe follows the company’s voluntary Chapter 11 proceedings initiated on March 23, 2025.

The investigation’s primary focus centres on the potential risks associated with transferring sensitive genetic information to potential buyers during the bankruptcy process. The absence of comprehensive federal data privacy laws in the United States has amplified these concerns, particularly regarding the possibility of foreign entities acquiring this valuable data.

House Oversight Committee Chairman James Comer has expanded the scope of inquiry by initiating a parallel investigation. Comer specifically highlighted concerns about the potential transfer of personal genetic data to foreign actors, including those linked to the Chinese Communist Party. As part of this investigation, Board Member Anne Wojcicki has been called to testify before the committee.

23andMe’s current financial situation has led to securing $35 million in financing to maintain operations during the restructuring process. However, the company faces increased scrutiny as direct-to-consumer genetic testing services are not protected under the Health Insurance Portability and Accountability Act (HIPAA), leaving customer data potentially vulnerable.

The situation has become more complex following a recent judicial ruling that permits 23andMe to sell its customers’ data, which represents the company’s most valuable asset. This development has intensified the debate over data privacy protection measures and their adequacy in safeguarding sensitive medical and genetic information.

The House Energy and Commerce Committee’s investigation underscores growing concerns about data privacy in the digital age. With 23andMe holding genetic information for millions of Americans, the need for robust protection measures has become increasingly apparent, especially given the current regulatory gaps in federal privacy legislation.

The ongoing investigations by multiple House committees highlight the intricate challenges of protecting personal genetic data during corporate bankruptcy proceedings. Their findings could potentially influence future regulations governing genetic data management and establish important precedents for similar cases.

As the investigation continues, attention remains focused on how 23andMe will manage and potentially transfer its vast database of genetic information. The outcome of these congressional probes could have far-reaching implications for data privacy protection and national security measures in the genetic testing industry.

News Source: CNBC