FTC launches investigation into surveillance pricing tactics of credit card companies

The Federal Trade Commission ordered eight companies to share information about surveillance pricing to study its effects on privacy , competition, and consumer protection.

In a press release , the FTC announced it had issued orders to Mastercard, Revionics, Bloomreach, Chase, Task Software, PROS, Accenture, and McKinsey & Co.

The agency said these eight companies use artificial intelligence and real-time customer data to customize prices for individual consumers.

The FTC is studying how third-party products using algorithms and AI use personal details such as location, demographics , credit history, and browsing habits to set specific prices for consumers.

FTC Chairwoman Lina Khan said the “inquiry will shed light on this shadowy ecosystem of pricing middlemen.”

“Firms that harvest Americans’ personal data can put people’s privacy at risk. Now firms could be exploiting this vast trove of personal information to charge people higher prices,” Khan said in a statement.

“Americans deserve to know whether businesses are using detailed consumer data to deploy surveillance pricing,” she said.

The agency did not provide any specifics on why these particular companies were chosen, but it emphasized its interest in “middlemen companies” that affect consumer prices across various sectors, including grocery stores and restaurants .

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These orders requested information on the companies’ products and services, the data sources used for each of these, the offerings provided to customers, and the prices paid by surveilled consumers.

The FTC voted 5-0 in favor of issuing such orders.