- The Washington Times - Thursday, April 4, 2002

Representatives of some of the nation's largest financial firms met yesterday to discuss using consumer databases to catch terrorists, alarming privacy advocates who cautioned that the information could be misused.
The meeting in New York was organized by the Center for Information Policy Leadership, a division of the Atlanta law firm Hunton & Williams. About 20 companies participated, including the investment firms JP Morgan and Fidelity Investments, lender CapitalOne, and credit-card companies American Express and Visa.
"We have to think about how to use information to create profiles about what a bad guy might look like," Marty Abrams of the Center for Information Policy Leadership told the Associated Press. The center consults with businesses, consumers and lawmakers on privacy and related policy issues.
The meeting was originally formed to combat identity theft, but companies became interested in how they could use their databases to cash in on the recent push for anti-terrorism measures.
Their consumer databases include information on credit-card activity and whether the person is a homeowner, travels frequently or has a job. The group is expected to present its findings to government officials in six months.
Proponents of the plan said that building profiles through monitoring consumer information could help find terrorists, who have raised red flags with their travel and spending patterns. Mr. Abrams said the group hopes to find a way to use the information without infringing on people's privacy.
But privacy advocates argue that the idea of using consumer databases to hunt down terrorists is risky.
"I think there are a number of major questions that need to be answered here," said James Dempsey, deputy director of the Center for Democracy and Technology in Washington and author of the book "Terrorism and the Constitution."
"What exactly are these companies planning to look for? To whom will they discuss the findings, and what opportunity will an individual have to rebut or confront any accusation made against them?"
Similar advocates questioned the feasibility of using consumer databases for anti-terrorism measures.
"My reaction would be that this is a good deal, as long as it's clear who can look at the information. But the proof of this will be how effective it is," said Stephen Keating, executive director of the Privacy Foundation in Denver. "They shouldn't just do it for the sake of doing it."
Using databases to profile people is not new. Companies have been doing it for years as a way to market their products and, in many cases, to protect their customers. For instance, if a credit-card company notices an unsually large amount of activity on a card, a representative will call that card's owner to check whether it was stolen. But transferring that technology to fighting terrorism may be tricky, some say.
"I'm skeptical," Mr. Dempsey said. "People often enter into these dicussions assuming data-mining is effective. But these databases are oftentimes inaccurate and were designed for purposes quite unrelated to counterterrorism."
Recent legislation such as the Gramm-Leach-Bliley Act and the Fair Credit Reporting Act, both passed in 1999, outline strict rules on how much information companies can use from consumer databases. But with heightened concerns over national security after the September 11 terrorist attacks, privacy has taken a back seat, some advocates say.
"This fits the theme of proposals being put forth in the name of national security that are obvious threats to privacy," Mr. Dempsey said.
Mr. Keating concurred: "When there's a national security issue, that will typically supersede privacy concerns."

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