Law enforcement agencies nationwide increasingly rely on automatic license-plate readers to track and store information on American drivers, a new report found, in the latest revelation in how the government gathers data on its citizens.

About 75 percent of federal, state and local agencies use these readers — cameras mounted on patrol cars, road signs and bridges — that photograph vehicles, scan license plates and record the time and date, according to the report (pdf) by the American Civil Liberties Union.

The system checks the plate numbers against a “hot list” of cars that have been stolen or used in a crime, and alerts police when it finds a match. But it also stores records on millions of innocent drivers.

FRONTLINE reported on the plate readers in the film Top Secret America, which showed that the federal government has encouraged their use as part of its effort to use state and local law enforcement agencies to help gather intelligence. (Watch the clip to see a plate reader in action.)

The use of these cameras is expanding, bolstered by millions in federal and state grants, the report found. The Department of Homeland Security alone spent more than $50 million in grants to help law enforcement agencies buy readers over the past five years. A full 85 percent of agencies said they planned to increase their use in the next five years, according to a 2011 survey (pdf) conducted by the Police Executive Research Forum.

But even as their use increases, the plate readers don’t generate many hits. In Maryland, for example, the system registered one hit for every 500 plates recorded. Of the hits, 97 percent were for a suspended or revoked registration, or a violation of the state emissions inspection program.

And while some departments delete the data after hours or days, others keep records for years or even indefinitely, even on cars not linked to a crime. Departments are also beginning to pool the data in regional databases, such as those at the 70-some fusion centers set up nationwide to coordinate counterterrorism efforts among law enforcement, which could lead to even less regulation of the data.

Private companies have also gotten into the business, building up huge databases to sell to law enforcement. MVTrac, for example, says it was data on “a large majority” of registered vehicles in the U.S., the report found. The Digital Recognition Network gathers data on up to 50 million cars each month. Vigilant Solutions has more than 800 million license plate records in its database, which is used by the Department of Homeland Security and more than two thousand other law enforcement agencies, the report said.

One major concern with the readers, the ACLU said, is that the scans could be used by police to track innocent people, or target groups based on their ethnic background or personal or political beliefs. In at least one instance in the U.S., that’s already happened.

In New York, police officers in unmarked cars used license plate readers to record the attendees at local mosques, the Associated Press found, as part of a broader effort to spy on the city’s Muslim community.

The ACLU filed hundreds of Freedom of Information Act requests for the data from state, federal and local agencies, asking how they regulated use of the automatic readers. Read the full report here (pdf). Find out about what’s happening in your state here.

Sarah Childress, Former Series Senior Editor, FRONTLINE