Amazon Accused Of Taking Payment Verification Data And Using It To Access Public Records

In the middle of a strange lawsuit against Amazon.com—one where an actress is suing because she says Amazon revealed her correct age—is a very serious payment-card IT accusation: that Amazon processed a payment and then used the card-verification data to gather more data and then published it.

To be fair, the lawsuit itself is a dubious document, with some statements that seem clearly false and others that seem to not recognize how Amazon and its Internet Movie Database unit (IMDb.com) function. But setting aside those issues—which certainly raise questions about the validity of the Amazon accusations—the charges bring up an interesting issue. Is it illegal, or even against the various card brand rules or PCI's rules, to use information from the confirmation process to access public information and to then use it? Amazon is not accused of publishing the verification data directly (which would have raised very different issues) but of using it to track down public records. And if Amazon indeed did that—and that's still a big "if"—is that a legitimate area for retailers to use to grow CRM databases?

Here are the key elements of the lawsuit filed last week in federal court in Seattle. An unidentified Texas actress, who the lawsuit suggests is about 40 years old and, had been using a stagename. She paid for a premium version of the Amazon-owned Internet Movie Database (IMDbPro) and, shortly after, saw that the IMDbPro database had been updated to display her correct date of birth "revealing to the public that Plaintiff is many years older than she looks."

A few quick thoughts: First, this actress is suing Amazon because it reported accurate information that undermined her efforts to engage in fraudulent and deceptive interactions with casting agents? She's admitting that she was deceiving clients, taking money from them that she argues they would not have given to her had they known the truth? If Amazon's damaging details were false, maybe. But she says the Amazon details were true. A very strange platform for a lawsuit.

Here's a wonderful line from the lawsuit: "Prior to subscribing to IMDbPro, there were absolutely no means by which Defendants could have obtained Plaintiff's legal name or date of birth." This actress had a home, neighbors, friends, relatives and enemies who she grew up with. And her birth and school records exist in various places. It seems absurd to argue that there were "absolutely no means" to determine such widely recorded data. Heck, I can think of a dozen right off.

Also, the nature of the IMDb system is that it has a huge list of volunteer contributors who get information—accurate and not-so-accurate—from all over. There appears to be no evidence cited in the lawsuit indicating that Amazon's payment processing was indeed the source of that information. It's possible, but it seems unlikely.

The lawsuit added: "Upon information and belief, it is Defendant's [Amazon's] standard business practice to routinely intercept, store, record, and further use consumer credit-card information obtained during the subscription process for the purposes of gathering information about subscribers and enhancing Defendant's business databases, which practice is unknown to and not consented to by consumers, and is completely beyond the scope of Defendant's Subscriber Agreement." The lawsuit also said Amazon uses that payment-verification data "to research and cross-reference public records and other sources to gather as much information as possible about each individual subscriber, including, but not limited to, his or her legal name, age, race, gender, personal shopping and spending habits, and Internet activity."Without suggesting that Amazon actually did this—and it's almost a certainty that this case will get quietly settled long before any Amazon executive has to take a deposition and answer these very delicate questions—the CRM possibilities are quite delicious. As noted earlier, the accusations are firm that the information revealed came from public records. The only purpose of the data from the payment verifications was to know which public records to seek.

Given that public records, by definition, are free to all, there is no legal problem with Amazon or anyone else disclosing what is in them. The tricky part is what lawyers call the fruit of the poisonous tree. If Amazon indeed had no realistic chance of searching that record without using verification data, this gets complicated. The payment-card numbers are restricted, but the verification data is less clear. Given that Amazon isn't accused of publishing that data, but instead data from a public file, this might open a new window into data-mining options.

Please keep in mind that at least one state—California—has already started trying to prevent this sort of effort with the Song-Beverly Credit Card Act of 1971, which expressly makes collecting information needed for a credit-card transaction and then using it for marketing illegal. How far this forces retailers to act, even in California, is another issue.

What if an anonymous customer uses a credit card to make a purchase. Using the address and the username, you are able to access Facebook and LinkedIn public posts and then start displaying highly targeted products. E-mail could violate SPAM rules, but if you merely change the pages she/he visits, would that be problematic?

If we assume—solely for the purpose of discussion—that Amazon engaged in the accused conduct, it would have never been detected had its unit not posted the found information on a public site. In the course of its E-tail work—and the course of retail functions by all major chains—that data would never have normally come to light.

I had an accountant years ago who would typically answer questions like "Is filing that type of deduction legal?" by saying "Let them find it." (It's hard to not like an accountant like that, but the IRS might take a different view.) Just because something isn't likely to be discovered doesn't make it right. More to the point, such matters do have a tendency of eventually being discovered, especially given the tendency of employees to move from one chain to a direct competitor.

"Discovered," though, presupposes that it's somehow wrong. Is it? There are clearly two definitions of wrong. One is legal. But the second is perception from the perspective of your customers. Legalities aside, will your customers think it's wrong? Or, even more basic, will they simply not like it and take their business elsewhere?

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