(Photo : Justin Sullivan/Getty Images) The Rite Aid logo is displayed on the exterior of a Rite Aid pharmacy on September 26, 2019 in San Rafael, California. Rite Aid stock surged today after the company reported better-than-expected second-quarter earnings despite revenues falling short. Rite Aid earnings per share rose 12 cents, beating analysts forecasts of 7 cents per share. (Photo : FRED TANNEAU/AFP via Getty Images) Photo taken on January 19, 2011 in Brest.
The Federal Trade Commission (FTC) investigation revealed that Rite Aid employed AI technology, specifically facial recognition, for criminal identification in their stores. The FTC determined that this technology disproportionately targeted individuals of color and inaccurately accused customers of crimes they did not commit.
Rite Aid has reached a settlement with the FTC not to use the technology for five years. The technology was initially made to identify shoplifters or troublemakers in their stores. However, this was not helpful because people were being wrongfully accused of shoplifting based on their skin color. Some employees accused certain people in front of their family and friends and were even subject to search when they had not done anything wrong.
Contrary to its intended purpose of deterring shoplifting, the technology became a significant issue for Rite Aid. The FTC noted that facial recognition was predominantly deployed in Black, Latino, and Asian communities. While Rite Aid expressed satisfaction in reaching an agreement with the FTC, they contested the facial recognition allegations outlined in the agency’s complaint. Rite Aid clarified that the technology was employed in a limited number of stores, with testing ceasing three years before the commencement of the FTC investigation.
Despite Rite Aid’s assertion, customer complaints submitted to the FTC spanned from 2012 to 2020, indicating the prolonged use of this technology. Rite Aid’s careless implementation of facial recognition technology resulted in embarrassment and humiliation for customers who were mistakenly identified as criminals instead of ordinary shoppers.
Moving forward, the FTC’s proposed order mandates that Rite Aid must "implement comprehensive safeguards" to prevent harm to customers when utilizing such technology. This order also stipulates that Rite Aid cannot use AI-based technology if it cannot adequately control potential risks to consumers. Rite Aid has ultimately agreed to these terms and emphasized their commitment to prioritizing customer safety.
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