Rite Aid’s ‘reckless’ use of facial recognition got it banned from using the technology in stores for 5 years

By Jordan Valinsky | CNN

New York — Rite Aid has agreed to a five-year ban from using facial recognition technology after the Federal Trade Commission found that the chain falsely accused customers of crimes and unfairly targeted people of color.

The FTC and Rite Aid reached a settlement Tuesday after a complaint accused the chain of using artificial intelligence-based software in hundreds of stores to identify people Rite Aid “deemed likely to engage in shoplifting or other criminal behavior” and kick them out of stores – or prevent them from coming inside.

But the imperfect technology led employees to act on false-positive alerts, which wrongly identified customers as criminals. In some cases, the FTC accused Rite Aid employees of publicly accusing people of criminal activity in front of friends, family and strangers. Some customers were wrongly detained and subjected to searches, the FTC said.

Rite Aid said in a statement that it’s “pleased to reach an agreement” with the FTC but added that “we fundamentally disagree with the facial recognition allegations in the agency’s complaint.” The tech was a pilot program and was only used in a “limited number of stores. The test stopped more than three years ago before the FTC’s investigation began.

The FTC’s legal filing, which contains customer complaints spanning from 2012 to 2020, said that some customers were “erroneously accused by employees of wrongdoing” because Rite Aid’s technology “falsely flagged the consumers as matching someone who had previously been identified as a shoplifter or other troublemaker.” The facial recognition software was mostly deployed in neighborhoods with large Black, Latino and Asian communities, the FTC said.

“Rite Aid’s reckless use of facial surveillance systems left its customers facing humiliation and other harms, and its order violations put consumers’ sensitive information at risk,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection, in a release.