Special Reuters Report: Rite Aid deployed facial recognition systems in hundreds of U.S. stores
- Over about eight years, the American drugstore chain Rite Aid Corp quietly added facial recognition systems to 200 stores across the United States, in one of the largest rollouts of such technology among retailers in the country, a Reuters investigation found.
"This decision was in part based on a larger industry conversation,” the company told Reuters in a statement, adding that “other large technology companies seem to be scaling back or rethinking their efforts around facial recognition given increasing uncertainty around the technology’s utility.” The cameras matched facial images of customers entering a store to those of people Rite Aid previously observed engaging in potential criminal activity, causing an alert to be sent to security agents’ smartphones. Agents then reviewed the match for accuracy and could tell the customer to leave.
In areas where people of colour, including Black or Latino residents, made up the largest racial or ethnic group, Reuters found that stores were more than three times as likely to have the technology. Adding to these concerns, recent research by a U.S. government institute showed that algorithms that underpin the technology erred more often https://www.reuters.com/article/us-usa-crime-face/u-s-government-study-finds-racial-bias-in-facial-recognition-tools-idUSKBN1YN2V1 when subjects had darker skin tones.
The security specialists expressed concern that information gathered by a China-linked company could ultimately land in that government’s hands, helping Beijing to refine its facial recognition technology globally and monitor people in ways that violate American standards of privacy. “There are a handful of retailers that have made the decision, ‘Look, we need to leverage tech to sell more and lose less,” said council director Read Hayes. Rite Aid’s programme was one of the largest, if not the largest, in retail, Hayes said. The Camp Hill, Pennsylvania-based company operates about 2,400 stores around the country.
FaceFirst’s chief executive, Peter Trepp, said facial recognition generally works well irrespective of skin tone, an issue he said the industry addressed years ago. He declined to talk about Rite Aid, saying he would not discuss any possible clients. Reuters reviewed a 2016 spreadsheet from the company’s asset protection unit in which Rite Aid rated 20 higher-earning Manhattan stores as having equal risk of loss – labelled “MedHigh.” Two of 10 stores where whites were the largest racial group had facial recognition technology when Reuters visited this year, whereas eight of the 10 in non-white areas had the systems.
FaceFirst’s Trepp said the company has high accuracy rates while running “over 12 trillion comparisons per day without any known complaints to date.” “The guy looks nothing like me,” said Jackson-Stankunas, 34, who ultimately was allowed to make his purchase and leave the store. Rite Aid “only identified me because I was a person of colour. That’s it.”
FaceFirst CEO Trepp said that his company takes racial bias seriously and would not work with any business that disregarded civil rights. “We cannot stand for racial injustice of any kind, including in our technology,” he said. DeepCam cameras photographed and took live video of every person entering a Rite Aid store, aiming to create a unique facial profile, Rite Aid agents said. If the customer walked in front of another DeepCam facial recognition camera at a Rite Aid shop, new images were added to the person’s existing profile. Two agents said they lost access to the images after 10 days unless the person landed on a watch list based on their behaviour in stores.
Other U.S. retail stores have tried DeepCam. Independent 7-Eleven franchise owners in Virginia told Reuters they conducted trials of the software starting in 2018 and later dropped it. They said they largely found the system accurate but not user friendly and too expensive to maintain. The system was advertised online as costing $99 a month.The two founding owners of U.S.-based DeepCam LLC were Don Knasel and Jingfeng Liu, who set up the firm in Longmont, Colorado, in 2017, state records show.
Internal correspondence reviewed by Reuters suggests that DeepCam reached a deal with Rite Aid by March 2018, when a colleague emailed Knasel to congratulate him. Internal records also indicated that China-based Shenzhen Shenmu helped its American counterpart with product development and that Liu was expected to pay at least some of the bills. That same month, a U.S. executive wrote: “Hi Jingfeng- Thanks for the credit card. Here is the receipt for the Indianapolis Trade Show.
More recently, in an interview and an email, Liu said he had not spoken with Knasel for more than a year and, to his disappointment, had not benefited from the U.S. venture.He did not address questions about DeepCam’s deal with Rite Aid. DeepCam, he said, is “winding up” its operations and now has no assets. He added that DeepCam never supplied China-based Shenzhen Shenmu with any data.
Last year, the U.S. government blacklisted several Chinese companies – including Hikvision, one of the biggest surveillance camera manufacturers globally – alleging involvement in human rights abuses. China has deployed facial recognition cameras widely within its borders, providing a level of monitoring unfathomable to many Americans.
Most notably, Shenzhen Shenmu’s largest outside investor, holding about 20% of its registered capital, is a strategic fund set up by the government of China. Called the SME Development Fund , it has built a 6 million yuan stake in Shenzhen Shenmu since early 2018, Chinese public business records show.
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