This Bankrupt Retailer Now Gets Into Unexpected Trouble

When things could not get worse, this bankrupt retailer now gets into unexpected trouble after failing to protect its customers.

Rite Aid was going high tech with its loss prevention by using artificial intelligence-based facial recognition surveillance systems from 2012 to 2020, in order to identify customers who may have been engaged in shoplifting or other problematic behavior in its stores, according to a complaint filed in federal court by the Federal Trade Commission.

The complaint, however, charged that Rite Aid “failed to take reasonable measures to prevent harm to consumers, who, as a result, were erroneously accused by employees of wrongdoing because facial recognition technology falsely flagged the consumers as matching someone who had previously been identified as a shoplifter or other troublemaker.”

Now the FTC is seeking to ban Rite Aid from using AI technology.

The FTC on Dec. 19 filed for a stipulated order and permanent injunction in the U.S. District Court for the Eastern District of Pennsylvania banning Rite Aid from using facial recognition technology for surveillance purposes for five years to settle FTC charges that the retailer failed to implement reasonable procedures and prevent harm to consumers in its use of facial recognition technology in hundreds of stores.

The proposed order will require Rite Aid to implement comprehensive safeguards to prevent harm to consumers when deploying automated systems that use biometric information to track them or flag them as security risks.

Rite Aid will also be required to discontinue using any such technology if it cannot control potential risks to consumers.

The drugstore chain will be required to implement a robust information security program, which must be overseen by the company’s top executives, to settle charges it violated a 2010 Commission data security order by failing to adequately oversee its service providers, .

Rite Aid’s procedures subjected consumers to embarrassment, harassment, and other harm, according to the complaint.

The company did not inform consumers it was using the technology in its stores, and it discouraged employees from revealing such information, according to the complaint.

This is a developing story.

Also Read: A US Company Now Declares An Unexpected Bankruptcy

Other Economy News Today

Market News Today - This Bankrupt Retailer Now Gets Into Unexpected Trouble.
Market News Today – This Bankrupt Retailer Now Gets Into Unexpected Trouble.

A popular electric company now announces an unexpected bankruptcy leading to the sale of its assets after failing to recover from the pandemic.

The electric scooter company Bird, once valued at $2.5 billion by investors, filed for Chapter 11 bankruptcy protection in Florida federal court Wednesday, reports CNBC.

The company has entered into a “stalking horse” agreement, which sets a floor for Bird’s value, with its existing lenders, according to a release.

Bird said it will use the bankruptcy proceeding to facilitate a sale of its assets, which it expects to complete within the next 90 to 120 days.

The company’s electric scooters are “touted as an environmentally friendly alternative to driving and other forms of public transit.

They exploded in popularity before the onset of the Covid-19 pandemic, and the company raised more than $275 million in 2019, which pushed its valuation to $2.5 billion,” reports CNBC.

“But after customers stopped riding as they were forced into lockdown in 2020, Bird struggled to recover.

The company went public via a merger with a special purpose acquisition company in 2021, but its share price tumbled.”

Bird’s bankruptcy proceedings come after the New York Stock Exchange delisted the company in September.

Bird failed to comply with the exchange’s requirements after it was unable to keep its market capitalization above $15 million for 30 consecutive days.

The company’s shares began trading on the over-the-counter exchange later that month.

As of today, the stock is under $0.08.

Bird Canada and Bird Europe are not part of the company’s Wednesday filing and will “continue to operate as normal,” according to the release.

This is a developing story.

Also Read: Massive Layoffs in California Now Underway Prior to Holidays

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Market News Today - This Bankrupt Retailer Now Gets Into Unexpected Trouble.
Market News Today – This Bankrupt Retailer Now Gets Into Unexpected Trouble.

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