Is Barclays Bank the new Big Brother

Posted by Jessica Searle in Identity Theft on 12 July 2013 - Jessica worked as a Credit Analyst at checkmyfile until 2013

With a growing concern from consumers over the safety of their personal information, Barclays Bank has confirmed its intent to sell the spending habits of millions of their current and savings account customers to third parties.

Customers have been informed of this recent step, telling them that ‘information about the transactions on your account’ will be compiled in order to report upon spending trends across Britain, which can then be sold on to third parties or Government departments.

Big Brother Watch, a civil liberties organisation, has released the results from a recent poll confirming that three quarters of people around the globe are concerned about their online privacy. The poll asked information from over 10,000 individuals across nine countries, including the UK, Germany and France. This finds that 41% of people feel that consumers are being harmed by big companies gathering large amounts of personal data for internal use.

Another revelation from those questioned is that two thirds of people feel that Google should be forced to comply more fervently to existing laws concerning privacy and personal data protection by national regulators.

Tesco, when launching its 'Clubcard' loyalty card 20 years ago, was one of the first companies to spot the potential of data mining. The information collated allows the data owner to plan and target promotions or new campaigns. This information is then also sold onto food and drink companies, in order for them to plan their own advertising and marketing campaigns.

The planned changes by Barclays Bank, set out in its new terms and conditions already posted to customers around the country, will take effect from around the start of October. Barclays Bank customers will also see the bank tracking them through their mobile phone or other devices, to aid in fraud protection.

If a transaction is made in a certain country, the customer's mobile number will be 'pinged' by the bank to check if the phone is currently in use there.

One potential example cited by the bank relates to a case where £1,000 is attempted to be withdrawn in Thailand, the bank then 'pings' the customer's mobile phone to see if there is a connection to a local network in the country to establish if the payment is genuine. If the customer’s phone is still in the UK, the transaction would then be refused as potentially fraudulent.

The information gathered by Barclays Bank to be sold has been confirmed to be 'high level' numerical information, not personal details through which an individual is 'identifiable'.

The bank believes that this will also benefit the customer, for example by being informed about spending more than their neighbours on energy bills.

Barclays Bank adds that it has worked in partnership with the Information Commissioner to establish the terms and conditions and to ensure that it adheres to industry best practices. These new terms and conditions will cover all of its 15 million current and savings account holders, but mobile phone tracking for fraud prevention is an option from which customers can opt-out if they wish.

A spokesperson for Barclays Bank says, “We will only be using information in a very high level anonymised way. When we say share with third parties what we are talking about is spending habit data of thousands of customers so for example we might share data with restaurants that consumers have started eating out more on Wednesdays than in the past.”

”It's not about selling our customer's personal details to call centres of anything of that nature. That's absolutely not what this is about.”

The knowledge generated from such sources has become increasingly valuable in recent years. Companies are now better able to target different age groups and demographics.

Information can give companies an insight into whether someone is planning to make a big purchase, buy a house, or are even about to have a baby.

This all being gathered by a number of companies who scour our web searches, social networking profiles, as well as our recent purchases, in order to formulate a sophisticated picture of our habits, likes and dislikes.

This information is being sold for a fractions of a penny, for example to the details of someone intending to buy a car can cost $0.0002, according to a recent report by the Financial Times.

Barclays Bank is not the only company to confirm its intention to sell customer data. The biggest mobile phone operators in the country, namely Vodafone, EE and O2, have each announced an intention to sell bundles of anonymous data about their customers to advertisers.

In May, Barclaycard launched a Groupon-style service, where based on their spending patterns, customers are able to sign up to receive vouchers from the like of Shell and British Airways.

The release of information by Barclays Bank is not as concerning as may first be perceived, with anonymised and fairly vague statistics being the information garnered from the shopping habits of their customers. This may even lead to a better deal for the customer in the current economic climate, or a little more protection from the ever-dreaded 'fraud'.

Jessica Searle is a Credit Analyst at checkmyfile and has a degree in English Literature from the University of Exeter. You can contact her at jessica.searle@checkmyfile.com

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