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Some Shoppers Find Fewer Happy Returns

Databases Limit 'Excessive' Exchanges

By Ariana Eunjung Cha
Washington Post Staff Writer
Sunday, November 7, 2004; Page A01

Darlene Salerno considers herself a loyal customer of the Express clothing chain, shelling out roughly $2,000 for its trendy outfits each year for the past decade. On a recent shopping trip, she bought a tank top, a button-down shirt and some khaki pants, but realized when she got home that she had similar items in her closet. So a few days later she took them back to the store. She presented the items, the receipt and waited for her money.

Instead, the saleswoman handed her a slip of paper that said "RETURN DECLINED" and told her to call the toll-free number at the bottom for more information. She phoned and was informed her account showed "excessive" returns.

KB Toys is among the national retailers rolling out electronic systems that track shopping history to decide if a consumer should be granted a return. (John Sushocki -- Springfield (mass.) Republican Via AP)

As the holiday shopping season gets into full swing, a number of major retailers -- including KB Toys and Sports Authority, according to store personnel -- are rolling out electronic systems that weigh the number of returns and exchanges a person has made, the dollar value of the items, and the dates of the transactions to decide whether a consumer should be granted another. The systems are designed to catch shoplifters and those who "wardrobe," wearing clothes and then returning them for a full refund.

But Salerno, 26, a receptionist at a Manhattan financial firm, said she falls under neither category. She returns things often because she buys things often. She said she feels she has done nothing wrong -- the clothes were never worn and the tags were still attached -- but that she was treated like a criminal.

"I'm embarrassed to go into the store," Salerno said. "I love their clothes, but I'm afraid to shop there now."

As more personal information is collected into databases, computers have been handed increasing power to make decisions about our everyday lives. The technological systems aim to solve costly and important business problems, but the proliferation of these "electronic blacklists" has alarmed consumer and privacy advocacy groups who say many databases have incomplete, incorrect or misleading information.

"Technology has made it cheap to do all kinds of surveillance and watch over people and make sure they obey the rules. But when a system makes a mistake, what can you do?" said Richard Smith, an Internet security and privacy consultant.

The Fair Credit Reporting Act of 1970 gives consumers rights concerning information used to make decisions about credit, insurance, employment or other services. Other federal laws impose disclosure requirements on information collected by the medical establishment or the financial services industry. But increasingly, companies are creating databases not envisioned by such regulations, and there is debate about which laws, if any, apply.

Peggy Twohig, assistant director of the Division of Financial Practices of the Federal Trade Commission, which administers the Fair Credit Act, said whether a particular information system is covered by it "depends on the particular facts of each system, and can be a complex legal question."

Among the databases being created is one for landlords that purports to list renters who have been evicted. Others claim to identify "known" spammers. St. Louis-based Talx Corp., meanwhile, has compiled more than 100 million employee records that contain names of companies, dates of employment and job titles. More than 1,000 firms, including American Airlines, FedEx Corp., Hewlett-Packard Co., Kmart Corp., Marriott International Inc., Microsoft Corp. and PepsiCo Inc., make use of the service to speed along the screening process for potential new hires.

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