California Bars Zip Code Requests From Credit Card Transactions

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Have you ever wondered why more and more retailers are starting to ask for your zip code when you use your credit card. Like most people, I just assumed this was part of a security enhancing scheme to ensure I am not using a stolen card. I always gave my zip out freely, figuring that is hardly personally identifiable information. No harm, no foul.

I Was Wrong

It turns out that your zip code, in combination with your name, is a very accurate way of determining who you are.  With those two pieces of information, it is very easy for a retailer to add your address to their marketing databases. This, according to information about a recent California Supreme Court ruling that makes it illegal for a retailer in that state to even ask. The plaintiff successfully sued the Williams-Sonoma store when it asked for her zip code. The store used that information to send mail to customers without asking for their consent.

Williams Sonoma Still Doesn’t Get It

People do not want to be added to marketing databases without their knowledge or consent. Sounds pretty obvious, doesn’t it? Not if your an attorney representing retailers.  Attorney Donna Wilson who represents retailers, was quoted as saying: “The whole idea of retailing is marketing. How do you get in contact with your customers if you’re not allowed to ask for the information?”  Wow, talk about being out of touch. Business do not have a right to your personal information for marketing purposes, regardless of what you think “The whole idea of retailing” is.  People walk into a store and are willing to exchange money for good and services. My personal information is not part of that transaction unless I consent, at least according to California law.

What About The Gas Station

The ruling specifically exempts gas stations that actually use zip codes for security reasons. The problem I have is that there does not seem to be much in the way of safeguards to prevent retailers from using information originally requested for security purposes to be later used for marketing. It will be up to consumers to notice the marketing and trace it back to the transaction.

What Will I Do

I do not live in California, and I do not think that my home state, Colorado, has a consumer privacy law like California’s. I have always declined to give out my address or phone number when asked by a merchant, but I have been willing to divulge my zip. Now that I realize there is little difference between giving your address and giving your zip, I will also decline to hand out my zip code when asked.   The problem will come when cashiers, correctly or incorrectly claim that the zip is required for security purposes to complete the transaction. I guess I will have to cross that bridge when I come to it, or just give them some bogus zip code.

Nothing irks me more than being the non-consenting target of a marketing campaign.  From now on, I will not let retailers trick me into handing out my personal information under the guise of credit card security.

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One Response to “California Bars Zip Code Requests From Credit Card Transactions”

  1. Greg Says:

    Merchants can and are charged higher Interchange processing fees on certian card types if a zip code and or address verification is not obtained from the customer or the magnetic stripe. The address verification through a zip code or street name allows the issuing bank to be more sure that the person using the card is the actual card owner as the billing address and or zip code does not appear on the front or back of the card. Once the information is obtained however it does not prevent the Merchant from using the information for marketing and or selling the information to other entities which has nothing to do with security of approving the transaction.

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