Calif. court: Merchants can't ask patrons for ZIPs

[Newsjock]

Source: Associated Press

The California Supreme Court says merchants in the state can no longer ask credit card customers for their ZIP codes.

The high court ruled unanimously on Thursday that asking for ZIP codes violates a longstanding California law passed to protect the privacy of credit card users.

The decision came in a lawsuit against Williams-Sonoma Inc., whose clerk asked Jessica Pineda for her ZIP code several years ago. Pineda sued the company in 2008, alleging the retailer violated the credit card law and her privacy.

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2011/0...

[enlightenment]

1. Sued them?

Dang - I just say 'no' when they ask. No wonder I'm poor; I just don't recognize money making opportunities when they present themselves.

[RUMMYisFROSTED]

26. Know your rights.

Although, it's hard when they're constantly shifting.

[SharonAnn]

58. This can be part of fraud prevention. Also, it would help them target ad flyers.

[hlthe2b]

2. Sued? Couldn't she have just refused?

I do so all the time... Yeah, it is a bit irritating to be asked, because it is all for their marketing. But, I've yet to have a clerk become bothered if I declined.

It is like the Safeway Starbucks folks ALWAYS asking if you want to buy a pastry. I know they've been told to ask, so i just politely decline or occasionally joke about it. The staff certainly don't like annoying the customer with the question any more than we enjoy being asked, but so what.... Just a minor annoyance.

[Billy Belknap]

15. Always better to sue.

100,000,000 lawsuits in the US each year. Gotta keep our stats up.

[swilton]

22. +

Always decline.

[WatsonT]

31. Yeah . . . if she wanted to be rude.

[hlthe2b]

34. Snarf... Oh, yes... not rude to sue at all...

Do you not know how to politely express that you would prefer to not give that information? really?

[WatsonT]

35. I was being snarky

obviously suing is more rude.

[hlthe2b]

36. Oh...

I often need the thingy.

[sofa king]

52. I prefer disinformation. My zip is 90210, baby!

All of you should be protecting yourselves by providing incorrect information when it is unnecessarily solicited. There's no need to give your real details to Starbucks or Facebook--in fact, it is only to your disadvantage to do so.

Degrading the data through disinformation is also the best way to dissuade companies from trying to use such practices. If everyone lied, nobody would be asking anymore.

[defendandprotect]

55. I refuse all the time -- didn't change a thing!

That's the purpose of lawsuits and punitive awards --

CHANGE for the better -- and that's why GOP/right wing elites want

"tort reform" -- !!

[Coyote_Bandit]

3. Lie

Since I really don't care about their marketing efforts I almost always respond with a zip code other than where I actually live.

[Kennah]

5. Here are some creative lies to tell

http://en.wikipedia.org/wiki/Postal_codes_in_the_United...

[mrmpa]

23. I use 90210, when I live in a 152 zip

[bemildred]

30. Yep. Pick something like 90263 (Malibu). nt

[happyslug]

59. I use 17927, Centralia, Pennsylvania. To a multi-decade coal fire, it is no more

http://en.wikipedia.org/wiki/Centralia,_Pennsylvania

[bemildred]

65. Tire fires and feedlots could be good too ...

But that is hard to top.

[joneschick]

4. I always just tell then the zip

for a part of my city where the annual household income is one of the lowest in the country. It's all about demographics. Then they can worry about how I *got* to their fine store. never thought of suing, damn.

[greiner3]

7. Be careful;

It's becoming common practice to use the zip as a verifier of the credit card. I've run into that using my card at pumps and once put in a different one and the card was refused.

[LiberalFighter]

12. They used that method at a Speedway a while ago. But then stopped.

I thought it was a reasonable check.

[WatsonT]

32. But what's so terrible about that?

You can look most people up on the internet well enough and get their exact location as well as a picture of their house. Seems like a zipcode is not that damning.

[sofa king]

56. It's the responsiblity of your card issuer to provide that verification, not you.

They may claim it's for verification, but I'm almost certain it is not. Instead, it's just one more way for marketers to match your card to your home.

[Rebubula]

6. Just...

...say 'No thank you' and politely refuse.

Some folks just like to sue

[unblock]

8. why on earth defend a corporation that's violating the law?

some folks get rather annoyed when corporations violate the law and think it's a good idea to try to get them to stop.

sometimes, market forces alone are good enough to get them to stop, but often not.

this is why laws exist, and they work for all of us only if someone's willing to put the time and effort and money into suing for enforcement.

[MikeW]

13. because ...

If its to verify the owner of the card I dont have a problem with it.

A marketing survey no.

If I was a merchant, you'd show ID or you can shop somewhere else esp. if your paying by check.

[unblock]

19. so YOU might not sue, but why object to someone else suing to stop illegal corporate behavior?

in this case, these are credit card customers, not check writers.

the california legislature decided that asking zip code is enough of a no-no to pass a law against it.

part of the problem is that many individuals don't object to it but if enough comply then merchants can do all sorts of rotten things, including discriminating based on zip code as a proxy for race.

in any event, if it's illegal, by all means customers should sue to get corporpations to abide by the law.

[MikeW]

20. personally

After having had my number stolen and used I think ALL MERCHANTS should require ID to use a credit card.

This law is BS but then again its Cali.

[Gormy Cuss]

39. Credit card issuers used to REQUIRE merchants to accept cards without asking for ID.

It was written into the master agreement between merchants and issuers.

The ruling on ZIP codes is based on existing CA law restricting the information that can be retained as part of a credit card transaction. You may think it's BS but credit card issuers haven't closed up shop in CA so either there isn't a greater loss here or the volume of business is so great that the CC companies don't want to lose it.

[unblock]

45. i've been a victim of id theft also. but there are other ways to provide id.

the corporation in this case is simply using an illegal method of identification.
they're welcome to ask for just about any other form of identification.

[May Hamm]

24. Excellent! I agree

Thank you for balancing this discussion with a rational perspective.

[WatsonT]

33. Because we have a finite number of courts

and judges and lawyers (doesn't seem like it sometimes though).

Every lawsuit that goes to court means another one doesn't or gets delayed.

This "let's sue to solve all our problems" mentality is not a good thing for this country.

[unblock]

44. no, it's the corporate "let's ignore the law" mentality that's not a good thing for this country

lawsuits are among the increasingly limited options we the people have for fighting back.

i agree that more courts would be helpful but it's not like rolling over on this one will get corporations to behave on other issues. in fact, i think the only way to get corporations to behave is to fight back EVERY TIME they flout the law.

[WatsonT]

46. Do you seriously view

suing over being asked for your zip code (which you could refuse and still receive service) as 'fighting' back against some corporate oligarchy?

Yeah I'm sure this will bring down their entire financial empire. Unless they just, you know looked at your name on the card then googled it and got the same results with your actual house address.

This is a minor affair, don't blow it out of proportion. An angry letter would have been far better.

[unblock]

47. lawsuits are invariably preceded by angry letters, just because the article didn't mention one

doesn't mean it didn't happen.

and while i appreciate your sarcasm, i obviously understand that this suit would hardly bring down the financial empire, nor is that the point.

the point is that corporations constantly chip away, in ways big and small, to try to get more information, more power, more control, more money.

this is just one small example of a customer keeping them in check, at least in one small instance.

[WatsonT]

49. And what freedoms are the customers losing

in this case? Or what new powers/wealth is the company acquiring? It's a fairly harmless anti-fraud effort that seems to work ok at cutting down on credit card fraud. The personal information derived from it is neither harmful to the customer nor unavailable through other methods.

So really, what is the harm? Not in general terms, but specifically, in this case, who suffers?

[unblock]

51. anyone from the wrong side of the tracks

merchants can use this information to refuse service or charge more or hassle people from certain zip codes in favor of another.

given that zip codes may be correlated with such things as race, it may provide a means to discriminate without being obvious about it.


in any event, the point isn't the merits of this law in particular. if you don't like the law, feel free to let the merchant violate it. or even, feel free to lobby the legislature for repeal. but don't fuss over someone who does object to the law challenging the merchant in court for violating the law.

[WatsonT]

57. Is there any evidence of that happening ever?

I mean really, prove it.

Because in my experience once you've already whipped out the credit card (which is when this would come up) their main goal is to get you to swipe it then leave, not discriminate based on your zipcode.

"given that zip codes may be correlated with such things as race, it may provide a means to discriminate without being obvious about it. "

Only if it's being used to deny service, which is isn't. You could just as easily say they might use your signature to discriminate against you when you sign for your purchase. Handwriting correlates somewhat to education level. Why not?

Except that that has never occurred. Just like no one has been denied service based on their zip code.

"
in any event, the point isn't the merits of this law in particular."

Indeed, the law lacks merits. What matters is our obedience to it.

[unblock]

61. here's one link for starters

http://www.black-collegian.com/career/creditrate1000.sh...

[WatsonT]

62. Major FAIL

that was about rates charged by credit card companies. Not stores denying services to credit card holders based on their zip-codes.

Discrimination and unfair credit practices by credit card companies are a real problem. However they are not what is being discussed here.

Now, do you have any sources citing incidents of stores refusing to take someones credit card* after they typed in their zip code?

*this would of course exclude those who used the wrong zipcode for that card and were suspected of having stolen it, that's the whole point of this so when it happens that's a good thing.

[unblock]

67. well, even in the case in question, the william-sonoma figured out the cardholder's address

from the name and zip code and then added them to their mailing list for their own marketing purposes.
not discriminatory, but an invasion of privacy and contrary to the law's intent.

you're supposed to be able to make a credit card transaction without the merchant knowing where you live.
if there's some means whereby you verify the credit card without the merchant being able to record your identification information, i think that's fine. for instance, if you have a keypad and swipe your credit card, and it asks for your zip code, that's fine, as long as the merchant doesn't record it. your credit card company can ask for your zip code to confirm your identity, but not the merchant. they merchant doesn't need to know it, it only needs to get the authorization from the card servicer.

[WatsonT]

71. So there are no examples

of people being denied use of their credit card by a store at checkout from their zipcode.

None.

[Fuddnik]

9. Doesn't say she asked for monetery damages.

Maybe just making them quit violating the law.

[XemaSab]

10. I always assumed it was so they'd know if people lived in that 'hood or not

The only store near here that asks for the ZIP code is Orchard Supply Hardware, and YES, I want them to stay in my neighborhood and not relocate to some other hood in some other town.

[truedelphi]

11. I thought that the store asking for your Zip Code info was done in the

Interests of a person's security.

Anyone can present a credit card to anyone else. When a merchant asks me for my zip code, instead of asking me for my Driver's License, how is that a violation of my privacy? They have the right to ask for ID, especially if your purchase is for a large amount. With yr Driver's License, they get your street info, as well as the Zip.

If you know the Zip, that tells the merchant that you are probably the real owner of the card. In fact, this is a pervasive practice - the debit machinery on Calif gas pumps asks for the zip code of the card holder. If you go in the store, and use your credit card to make the purchase a "credit" purchase, you have to use your signature.

Not sure I am following the logic or (il)logic of any of this.

[LiberalFighter]

18. No they don't have the right to ask for ID.

Merchants must follow the agreement with MasterCard or Visa.

MasterCard
A merchant must not refuse to complete a MasterCard card transaction solely
because a cardholder who has complied with the conditions for presentment
of a card at the POI refuses to provide additional identification information,
except as specifically permitted or required by the Standards. A merchant may
require additional identification from the cardholder if the information is
required to complete the transaction, such as for shipping purposes. A
merchant in a country or region that supports use of the MasterCard Address
Verification Service (AVS) may require the cardholder’s ZIP or postal code to
complete a cardholder-activated terminal (CAT) transaction, or the cardholder’s
address and ZIP or postal code to complete a mail order, phone order, or
e-commerce transaction.


VISA
When should you ask a cardholder for an official government ID? In most cases,
merchants may not ask for an ID as part of their regular card acceptance
procedures, either when a valid card is first presented or to complete a sale.
Laws in several states also make it illegal for merchants to write a cardholder’s
personal information, such as an address or phone number, on a sales receipt.
If you are suspicious about the transaction or feel you need additional information
to insure the identity of the cardholder, make a Code 10 call.

[May Hamm]

25. Hmmm... I had no idea

I never could have guessed that asking for ID was prohibited. Interesting.

[LiberalFighter]

29. As long as the owner of the card follows the rules.

Oh... and they don't recommend putting see ID for the signature part. Apparently it is not a deterrent to fraud.

[May Hamm]

37. My friend has 'check ID'

On the back of his credit card. He said they almost never ask for ID. Go figure.

[Gormy Cuss]

40. The merchant is supposed to refuse an unsigned card.

It's another stipulation of the master agreements between issuers and merchants.

[May Hamm]

41. Refuse an unsigned card? LOL!

None of my cards are signed and never have I been refused. I dunno, I just never got around to signing them and it's never been a problem.

[Gormy Cuss]

43. Nevertheless, it is in the merchant agreements.

I know that it's true of both VISA and Mastercard.
See here for Mastercard's own description:
http://www.mastercard.com/us/merchant/pdf/Unsigned_Cred...

[LiberalFighter]

69. What heppens then is if there is a problem with a card because they

accepted a card that was not signed is the merchant would end up any fraud charges being paid by them.

[Swede Atlanta]

14. I would want to see the specifics of the case............

It is absolutely inappropriate to require a customer to provide their zip code at time of purchase if the only purpose is marketing (e.g. they see they have thousands of customers living in a particular zip code and decide to open a store there).

Asking for zip code information, however, is appropriate and something I welcome, if part of the credit approval process (e.g. at a gas station pump). If the credit card company wants to use the card user's knowledge of the zip code associated with a credit card to prevent fraud I support those efforts.

But the marketing angle is an overreach. I always give them a zip code from my home state which is thousands of miles from where I live so I simply skew their results.

[Moosepoop]

21. Here you go

From the linked article in the OP:

The Supreme Court said that Williams-Sonoma recorded Pineda's ZIP code in an electronic cash register, which was fed into the company's central database. From there, it used software to match the customer's name and ZIP code with her undisclosed address, information it can use to market its own products and sell to other businesses. That's why the Supreme Court ruled that acquiring a customer's ZIP code violated the California law.

"This really bolsters and further protects the privacy rights of California consumers," said Gene Stonebarger, Pineda's attorney. Stonebarger said not all retailers who request ZIP codes will have to stop the practice.

He said gas stations that require ZIP codes be entered at the pump are exempt because the gas station "doesn't record the transaction." Stonebarger said that information is sent directly to the banks and credit card companies as a security measure and those transactions won't be affected.

The Supreme Court returned the case to the appeals court for further action, which could include assessing damages. Merchants can be fined up to $250 for a first time infraction and as much as $1,000 for additional violations.

[htuttle]

16. Online transactions that don't check your zip get charged extra by the CC companies

At least for 'card not present' transactions (ie., those that don't include the actual magnetic stripe data from the back of the card, such as online purchases and those that still use old fashioned 'kerchunk' machines and triplicate slips), merchants pay a considerably higher rate to process the transaction if they fail to do what is called an AVS check. That checks the billing address of the card against the numeric part of the person's address and/or the zip code. The other tool for card verification is the security code on the card (a 3 or 4 digit number). Of course, there are problems with AVS checks, such as if a person has their credit card statements mailed to a PO box (won't verify), and the credit card companies are notoriously slow in updating the cardholder information used for AVS checks, so if you move, it might expect your old address for a long time. Of course, the card isn't denied if it fails the check. In fact, most merchants pay the same rate whether it passes or not, but they usually pay much more if they don't do the AVS check at all. BTW, I write software that deals with this at work -- I'm not a credit card geek.

So does this ruling apply to online sites in California, too? If so, the Court probably just cost California merchants quite a bit of money.

Seems typical of the whole credit card industry, though. Believe it or not, merchants get screwed harder than credit card holders. Here's an example: the payment card industry spent years convincing merchants to purchase and install PIN keypads to process debit transactions and get better processing rates, and then they turn around and tell their card holder customers that they can get an extra discount if they DON'T use the PIN pads, but instead use their debit card as a credit card they sign for (so the merchant pays a higher rate). Rat. Bastards.

[Fuddnik]

17. Some places want it for cash purchases.

Radio Shack wants your phone number. I tell them I don't have one.
Zip Code. I don't have one. I'm homeless.

Best Buy was the worst. I was paying cash for some minor purchase.
Your name? I'm not giving it to you.
But I need this information. No you don't. All you need is my money.
I can't ring it up without your name. Stick it up your ass. I went across the street to Circuit City, and bought it with no hassle.

People talk about protecting their privacy, but they willingly surrender it several times daily.

[Scottybeamer70]

27. I'm with Fuddnik......

[TorchTheWitch]

70. this same shit has happened to me with cash purchases

And the worst offenders I've experienced were - just as you said - Radio Shack and Best Buy.

[mitchtv]

28. our gas station asks when I put the ccard

into the pump automatically, before it oks the purchase.

[boppers]

48. See post #16

They're verifying that the card holder *roughly* knows where it's billed to.

[sofa king]

53. Right. That's why they punch that information straight into the computer.

If verification is all that was wanted, it would be checked, not recorded. They're trying to match your card against your address within that zip code, the better to extract money from you later through targeted marketing.

[saras]

38. Verification and research are two different things

If they TELL me it's for verification, then I have to give it for verification.

If not, I assume it's marketing research, and lie.

And of course, if a credit card isn't involved (lots of businesses around here ask even if you pay cash), of course I lie - often a grossly obvious one that makes it clear I'm refusing to cooperate. Like 'three'. Or 'my ZIP code? Twenty bucks for a blowjob'.

If, in the state Ms. Pineda was in, asking DID violate the credit card law, then a lawsuit is a perfectly reasonable response.

[Occulus]

42. .

.

oops

[USA_1]

50. Gee, Then How Do We Know ....

Remember when ZIP codes were used to determine who were the biggest pornography users in the USA? It was determined that Mormons in Utah and other right wingers were the biggest porn lovers thanks to that type of statistical information.

Names should always be kept protected. But the idea of using ZIPs is good in that it proves how right wingers buy porn, drugs, guns, and other forms of illegal or harmful material while proclaiming themselves to be good Christians.

[defendandprotect]

54. Good news -- I always say, "You don't need my zip" -- and clerks are performing surveys ...

for these companies without getting extra pay for doing it --

invasion of privacy --

and clerks shouldn't be put in this position --

[Xithras]

60. The downside. Many gas pumps will soon stop accepting credit cards

Most credit card companies require retailers to authenticate the cardholder before accepting the transaction, and the retailer is forced to take a loss when a fraudulent purchase is made.

In the "old days", you could only perform credit card purchases if you went inside and signed the slip first. Zip verification allowed the transaction to be moved to the pump, which is much more convenient for the motorists.

By eliminating zip verification, we'll soon see gas stations return to the old method, where only ATM cards can be used at the pump. Because ATM transactions have associated fees, this will end up costing everyone more money.

Awesome.

[xchrom]

63. good. nt

[slackmaster]

64. This will be especially traumatic for Radio Shack

[Heywood J]

66. They never know what to make of my response.

L7T 2W4.

It's interesting to watch people's reactions to that.

[24601]

68. Needs to go to federal court - becoming a merchant doesn't strip

the freedom of speech - even in the form of a question.

[So Ill]

72. Hmm

They use this tactic where I live in order to save money. If a certain store does not have customers from three counties over they quit mass mailing sale flyers to those counties. (Three counties over was just an example)........

[JI7]

73. how about in cases where they ask everyone ? Trader Joe's sometimes asks people

including those who pay with cash . they do it to get info on where to open up new stores.

[sarcasmo]

74. When they first started doing this I used to make up a zip code.