Home » US business news » FTC proposes a five-year ban on Rite Aid’s facial recognition use

FTC proposes a five-year ban on Rite Aid’s facial recognition use

By Nithya Bose in US business news, posted December 20, 2023

The Federal Trade Commission has barred Rite Aid from using facial recognition surveillance in its drugstores for five years.

The FTC alleges between 2012 and 2020, Rite Aid used facial recognition technology across hundreds of its retail pharmacies in various states.

The company aimed to identify customers likely to be involved in shoplifting or other criminal activities.

However, the system reportedly produced thousands of false-positive matches, leading to the misidentification of innocent shoppers.

These people faced consequences such as detention, increased surveillance, public accusations of criminal activity, police reports, and, in some cases, bans from Rite Aid stores.

The FTC claims that facial recognition technology was more prone to generating false positives in stores situated in predominantly Black and Asian neighborhoods compared to predominantly white communities, where 80 percent of Rite Aid stores are located.

Rite Aid allegedly utilized facial recognition technology from two undisclosed vendors, maintaining a database of individuals considered persons of interest.

This database comprised images obtained from security camera footage, driver’s licenses, or government IDs, along with personal data such as names, birth years, and information about alleged criminal or dishonest behavior.

The FTC filed its complaint in the US District Court for the Eastern District of Pennsylvania.

It suggests that the database contained tens of thousands of people.

Under the proposed settlement, Rite Aid must instruct third parties to delete images collected by its facial recognition system.

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The drugstore must also notify shoppers when biometric data is collected or used in connection with security or surveillance systems.

Rite Aid must also discontinue using the technology permanently if it cannot mitigate potential consumer risks.

The company expressed satisfaction in agreeing with the FTC but disagreed with the agency's allegations.

The company clarified that the allegations pertain to a facial recognition technology pilot program deployed in a limited number of stores, discontinued over three years ago.

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The FTC's action follows a 2020 Reuters investigation exposing Rite Aid's use of facial recognition technology in primarily lower-income, non-white neighborhoods.

Identified vendors included DeepCam and FaceFirst, with the latter's technology reportedly misidentifying Black people as shoplifters.

Privacy and civil liberties advocates continue to voice concerns about facial recognition software and the need for further regulation.

The proposed settlement awaits approval by the court overseeing Rite Aid's bankruptcy proceedings.

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