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Sears told to destroy data gathered by online tracking software

Catalogue of snooping does not impress FTC

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US retailer Sears has been ordered to destroy all the customer data it collected from a piece of online tracking software that consumer regulator the Federal Trade Commission (FTC) said was unfairly used.

The FTC said that while customers had been warned that, once downloaded, software would track their browsing, it had in fact tracked browsing on third party websites, secure browsing including banking and transactions and even some non-internet computer activity.

"The FTC charged… that the software also monitored consumers’ online secure sessions – including sessions on third parties’ Web sites – and collected consumers’ personal information transmitted in those sessions, such as the contents of shopping carts, online bank statements, drug prescription records, video rental records, library borrowing histories, and the sender, recipient, subject, and size for web-based e-mails," said an FTC statement.

Sears has been ordered to make notification of any future tracking clearer, and to delete all the information gathered through the use of the software.

"Only in a lengthy user license agreement, available to consumers at the end of a multi-step registration process, did Sears disclose the full extent of the information the software tracked," said an FTC statement. "The [FTC] complaint charged that Sears’s failure to adequately disclose the scope of the tracking software’s data collection was deceptive and violates the FTC Act."

Sears, which owns KMart, has settled the case with the FTC, the regulator said.

Sears paid some visitors to sears.com and kmart.com $10 to participate in a scheme to monitor their browsing via "research software".

The full extent of the monitoring was only made clear in a long user agreement visible after the downloading of the software. Sears has agreed to tell users more clearly and prominently what activity will be recorded, and to do so before any software is downloaded.

The case resulted from an administrative complaint from the FTC itself. "The Commission issues or files a complaint when it has 'reason to believe' that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest," it said.

Copyright © 2009, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

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