PIRG accuses Mastercard of selling cardholder data

A group of consumer advocacy and privacy organizations is taking Mastercard to task for harvesting and selling cardholder information. In a letter sent last month to Mastercard CEO Michael Miebach the group, spearheaded by U.S. PIRG, asked the card giant to stop selling cardholder to data third parties that have nothing to do with authorizing and settling card payments.

And they requested a meeting with Mastercard executives on "a respectful approach" to using cardholder data.

"In order to serve as a payment network, it makes sense that Mastercard has to collect some data about consumers – like how much money the cardholder spends, where and on what day. What doesn't make sense is that Mastercard then uses that data for purposes that have nothing to do with being a credit card – like selling it to brokers, advertisers and other companies," the letter stated. "[W]e are asking Mastercard to commit to a limited use policy and purpose specification – only collecting data required to be a secure credit card [payment], and using the data only for that purpose."

Eight consumer advocacy and privacy groups signed the letter, in addition to PIRG, including the American Civil Liberties Union and the Privacy Rights Clearinghouse.

Taking issue with unregulated, unsecured data sharing

Mastercard isn't the only company that sells consumer data. And it is far from the "worst actor," R.J. Cross, director of PIRG's newly formed Don't Sell my Data Campaign, wrote in a recent blog post.

But Mastercard is uniquely positioned to understand how people spend money and other details of their lives, and its monetization of consumer data has been a major revenue driver, Cross wrote.

The company has access to "enormous amounts of information derived from the financial lives of millions, and its monetization strategies tell a broader story of a data economy that's gone too far," Cross asserted. "Mastercard has a lot of ways it makes money off people's data," she added. For example, it bundles and sells transaction data to third parties through online data marketplaces.

"This means people's data spread rapidly throughout the digital economy," the letter to Mastercard's CEO noted. "The more companies that hold an individual's data, the more likely it is that data will be exposed during a breach or hack." There also have been instances when data brokers have been found to supply personal consumer information to scammers who use the information to identify potential victims.

Then there is Mastercard's in-house data and services division, which sells insights with monikers like "intelligent targeting," Cross wrote. They help buying companies identify and target ads to "high-value" prospects.

Mastercard responds

Mastercard disputes PIRG's assertions. "Let us be clear – Mastercard does not sell personal cardholder data for marketing, location tracking or targeted advertising. Ever," stated Seth Eisen, senior vice president, communications for Mastercard.

"Our Privacy by Design Approach and our Data Responsibility Principles guide all our data practices globally," he continued. "The promise made to consumers is straightforward - when it comes to your data, you own it, you control it, you should benefit from the use of it, we protect it. "These principles are at the heart of our operations and are incorporated into all Mastercard innovations and products, enabling us to earn, protect, and cultivate the trust that has been placed in us by our customers, their customers, and consumers at large."

It's not just Mastercard that these groups have in the crosshairs, either. "Companies have taken data harvesting and sales too far," Cross asserted. "The collection and sale of people's data is almost entirely unregulated, and virtually every major company has begun monetizing customer data in ways people are not expecting."

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