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Report blasts companies on privacy

Despite corporate claims, a new report says companies aren't doing enough to protect the privacy of individuals on the Net.

Companies probably will tell the Federal Trade Commission this week that they're doing enough to safeguard privacy of individuals on the Internet. But they're not, according to a report by the nonprofit Electronic Privacy Information Center released as the FTC holds a privacy hearing this week.

And some companies, such as online service giant America Online (AOL) are collecting their own information about customers, such as their household incomes, from outside databases and then aggressively selling that information to marketers, to according to the newsletter Privacy Times.

AOL, which does not go out of its way to publicize that it sells its mailing list, "buries" the disclosures in its terms of service, said Evan Hendricks, editor of Privacy Times. Most AOL members have no idea it's being done, he said.

Hendricks said he found that AOL was advertising a list of people who bought merchandise in the online store, which list could prove extremely valuable to anyone who wanted to identify a large group of electronic consumers.

While the AOL scenario is not necessarily the norm, collecting private information on Netizens without their knowledge is all too common, the EPIC report concludes.

EPIC surveyed the privacy policies (and lack thereof) of the top 100 Web sites, as reported by 100.hot. What they found alarmed, but didn't necessarily surprise, EPIC legal counsel David Sobel.

Nearly half the sites--49--collected personal information through online registration, mailing lists, surveys, and profiles, the study said. But only 17 of the 100 sites had policies that could be obtained easily and explained what, if anything, the companies collecting the information intended to do with it.

"At a minimum, people should know what's being done with the information," Sobel said.

Ideally, sites should not be collecting private information at all, he said. Many, such as the Washington Post and CNN, do not--and still manage to sell advertising and make money, the report states.

"There is currently a good deal of personal information being collected on the Internet," Sobel said. "Users are not being informed as to the uses that that information is being put to. There is an easy solution to this problem, and that is to support anonymity."

Anonymity is especially important in cyberspace, where very detailed information can be collected, such as the type of news stories a person reads.

In a worst-case scenario, Sobel envisions an employer deciding against hiring someone because the company discovers something that it finds offensive about the applicant on a databse somewhere.

That is why, he argues, the online environment is so different.

"The problem online is the interactivity allows them to connect a lot of other information to my name," Sobel said. "People need to be very cautious about providing information online, and they need to express their preference for those sites that support anonymity."