Ten privacy groups urged Congress on Tuesday to take greater steps to limit advertising that tracks consumers’ behavior online.

The coalition, which included the Electronic Frontier Foundation, Consumers Union and Privacy Rights Clearinghouse, singled out behavioral advertising, in which Internet users are tracked, analyzed and served ads based on the information gleaned from their movements, in its recommendations. Doing something about the practice has become more urgent as consumers go online for increasingly sensitive transactions, members of the group said on a call with reporters.

“We want consumers to be able to take advantage of all of the new technologies without the technologies taking advantage of the consumers. Right now, that balance is not there,” Pam Dixon, executive director of the World Privacy Forum, said.

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In an interview Friday, Rep. Rick Boucher, (D-Va.) called for Congress to take a tougher stance in regulating online ad-targeting, despite the FTC’s endorsement of industry self-regulation.

“I am coming to believe (industry self-regulation) is not sufficient,” said Rep. Boucher, chairman of the House subcommittee on communications, technology and the Internet. He noted that there is a need for a set of laws that dictate parameters for how companies collect, share and use online data about their consumers.

In its report, released Thursday, the FTC laid out a number of principles to guide practices for online behavioral targeting, in which a company tracks consumers’ online activities, such as the searches they perform and the Web sites they visit.

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Perhaps the scariest term in business today is “behavioral targeting.” It also turns out to be one of the best practices around to assure the combination of consumer choice and marketing effectiveness on the Internet. And in that gap lies a dilemma for the marketing and media industries–and, indeed, for all citizens. For if fear overtakes reality, it could dramatically limit the accessibility and diversity of the Web.

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