Rite Aid Banned From Using AI Facial Recognition in FTC Settlement
20 December 2023 - 9:57AM
Dow Jones News
By Ben Glickman
Rite Aid has been banned from using facial-recognition
technology for surveillance purposes for five years as part of a
settlement with the Federal Trade Commission.
The bankrupt retailer on Tuesday settled charges by the FTC that
it had failed to put in place safeguards to prevent harm to
consumers after it rolled out facial recognition in hundreds of
stores.
Rite Aid said in a statement it was pleased to reach an
agreement with the FTC and "put this matter behind us."
The Philadelphia-based company said it "fundamentally" disagrees
with the allegations in the FTC's complaint because the company
deployed a facial-recognition pilot in a "limited number of
stores." Rite Aid said it stopped using the technology more than
three years ago, before the FTC began its investigation.
The FTC's complaint alleged Rite Aid's artificial
intelligence-based technology used between 2012 and 2020 led to
consumers being false accused of wrongdoing, as they were matched
with people previously known to be shoplifters.
The FTC said Rite Aid's system generated thousands of
false-positive matches, and was more likely to return false
positives in plurality-Black and Asian communities than in white
ones.
The order by the FTC also requires Rite Aid to delete any images
or photos collected by its facial-recognition system, notify
customers if their information is being put into a database, delete
any biometric information it collects within five years and put in
place a data security program, among other things.
The order will take effect after it is approved by bankruptcy
and federal district courts.
Write to Ben Glickman at ben.glickman@wsj.com
(END) Dow Jones Newswires
December 19, 2023 17:42 ET (22:42 GMT)
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