ZIP Code at Checkout: Retailers Selling Info, Say Privacy Advocates

Wednesday, 20 Mar 2013 03:29 PM

By Morgan Chilson

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Customers may want to think twice about revealing their zip code when they’re checking out at a store. Though it doesn’t seem like private information that’s necessary to protect, the advocacy group Privacy Rights Clearinghouse warns that stores are using that information to flood mailboxes with junk mail.

Not only are merchants using the zip code to get further information and send catalogs, but in some cases PRC warns they sell the information to other merchants, according to NBC News.

Customers often believe the zip code is required to complete their credit card transactions, but courts have ruled repeatedly that it’s not information that merchants have a right to collect. For instance, in information highlighted by PRC, the California Supreme Court said merchants couldn’t require zip code information in a case featuring Williams-Sonoma stores, which used customer zip codes to get home addresses and send catalogs.

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In an interview with NBC news, Paul Stephens, director of PRC, pointed out that some companies collect the information to determine where their customers live. But it’s becoming more common to sell the information to data brokers.

Privacy issues are becoming more of a concern to consumers as identity theft and the availability of online information becomes more prevalent. Identity theft hit a three-year high in 2012, according to Yahoo News.

The 2013 Identity Fraud Report, done by Javelin Strategy & Research, found that 2012 identity fraud incidents increased by more than one million victims and resulted in the more than $21 billion being stolen. The report also found that 1 in 4 people who received a letter saying their account numbers or Social Security numbers had been breached eventually became the victim of identity fraud.

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PRC, which has a large section on its website about identity theft and security breaches, encourages consumers to know their rights – and know that they don’t have to give out a zip code when they use a credit card.

Related stories:

Richest ZIP Codes Tend to Vote Democrat

IRS Nabs 389 Tax Identity Theft Suspects

ID Theft Expert Sileo: Easiest Way to Protect Yourself Is to ‘Freeze Your Credit’

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