The Federal Trade Commission today announced a settlement with the pharmacy chain Rite Aid that will include a five-year ban on the company using artificial intelligence-powered facial recognition technology.

The FTC said Rite Aid had acted recklessly when it used the technology in its stores from 2012 to 2020 to capture images of its customers in an effort to cut the number of shoplifting incidents. Customers who had acted suspiciously had their faces saved in a database, sometimes beside of personal information.

Using facial recognition software, a technology already with a controversial history in the U.S., employees would receive an alert on their phones telling them a customer was to be watched. That customer would then be followed around the store. They were sometimes subjected to a search, accused of shoplifting, or Rite Aid would call the authorities to have them removed.

The FTC said this led to false positives, especially where black people were concerned. The agency added that the facial recognition software was usually implemented in minority neighborhoods.

“Preventing the misuse of biometric information is a high priority for the FTC, which issued a warning earlier this year that the agency would be closely monitoring this sector,” the FTC said in a press release. “Rite Aid’s actions subjected consumers to embarrassment, harassment, and other harm.”

The complaint also states that the customers subjected to searches were never told about the technology that had picked them out of the crowd. The complaint states that Rite Aid had “instructed employees not to reveal” this fact. The stores in question were located in Atlantic City, Baltimore, Detroit, Los Angeles, New York City, Philadelphia, Sacramento and some other cities.

Rite Aid said in a statement that while it respects the FTC’s inquiry, it fundamentally disagrees “with the facial recognition allegations in the agency’s complaint.” The company said the allegations only relate to a pilot program tested in a limited number of stores and that it had put an end to the program three years ago, prior to the FTC’s investigation.

Nonetheless, Rite Aid agreed to the five-year ban and said it would agree to the “comprehensive safeguards” the FTC asked to be put in place. Any data on its systems has to be deleted, and, in the future, customers must be informed if their biometric data is collected. That’s if there is a future. Rite Aid is currently in the process of shutting down many of its stores while going through bankruptcy proceedings.

Facial recognition tech has always been met with suspicion from a large part of the American public concerned that such futuristic software is a leap toward China-style mass surveillance. In 2020, it was banned in Maine, while major companies that had previously developed the technology have, for the most part, put the brakes on. Even so, it’s still widely used by law enforcement in the U.S.

Photo: Nick Loggie/Unsplash