Firm Abruptly Withdraws Claims Called False; ChoicePoint Statements Challenged by Aristotle International

Nov 22, 2005, 00:00 ET from Aristotle International

    WASHINGTON, Nov. 22 /PRNewswire/ -- ChoicePoint, the embattled Atlanta-
 based company that aggregates and sells personal information dossiers on every
 American, has abruptly dropped a bold -- and allegedly fraudulent claim made
 at the company's website, according to a statement from Aristotle
     Earlier this Fall in its online advertising ChoicePoint boasted about
 having received approval by law enforcement agencies for a service it was
 providing to merchants.  "ChoicePoint's age verification solution has already
 been reviewed and approved by state Attorney General offices as an acceptable
 means of electronic age verification for age restricted products," stated the
 web page.
     Given the company's run-ins with the law at both the state and federal
 level, the blessing of state authorities would meet CPS' acute public
 relations needs -- if it were true.
     Instead, as some of the very law enforcement agencies who supposedly
 endorsed ChoicePoint began to report that they had no record of any "review"
 or "approval" of any ChoicePoint age verification system, the likelihood of
 further scrutiny by the AGs grew, controversy built, and the company quietly
 pulled the suspect statements by taking down the pages of its website that had
 featured the endorsement boasts.  More recently it replaced those pages, but
 without the claims of "review" and "approval" by law enforcement agencies --
 and also without an explanation, correction or public apology.
     This new flap comes at an inopportune time for the credibility of
 ChoicePoint management, and more scrutiny from law enforcement agencies is
 likely to be unwelcome in the executive suite.
     In fact, some of the same state law enforcement officials who were said to
 have supposedly endorsed ChoicePoint's products are actually investigating the
 company's management practices, securities trading, and contracts.  In 2005
 ChoicePoint has been forced to acknowledge egregious lapses that have led to
 highly publicized privacy violations, lawsuits and embarrassing settlements.
 The company recently paid seven million dollars to settle just one lawsuit
 with a group of Illinois insurance agents who alleged that ChoicePoint had
 stolen their customer lists and then sold the proprietary data to the
 plaintiffs' competitors.
     Despite being challenged this fall on the allegedly deceptive content of
 its website, the company and its marketing partner continued to use the claim
 as an advertising hook to try to generate age verification business from
     There is no indication yet as to how many winery prospects -- if any, may
 have purchased the ChoicePoint service under the apparently false pretense
 that it was 'reviewed and approved' by law enforcement agencies.  But the
 assumption made by some close to the story is that ChoicePoint sought both to
 leapfrog its competition and redeem its tattered reputation by invoking the
 generic good offices of state Attorneys General, unafraid that any reporter or
 consumer advocate would either detect the suspect statement or undertake the
 arduous effort to verify the open-ended claim.
     "This apparent misrepresentation is unfortunate because many wineries are
 committed to protecting children and doing the right thing in building their
 online sales operations," said John Phillips, CEO of Aristotle, the company
 that first brought the issue to the attention of law enforcement agencies.
     "To falsely claim to have the endorsement of law enforcement agencies
 seems typical of the leadership's behavior at ChoicePoint. How much harm can a
 big data firm do," asked the CEO, before merchants' stop to consider the
 potential damage to their brands? "The top management is unfit to be entrusted
 with sensitive personal information -- or to run a public company.
 Unfortunately, any winery or other merchants who accept ChoicePoint's
 outrageous claims and do business with the company without first executing
 basic due diligence will learn this the hard way."
     New opportunities for offering effective online age verification services
 have emerged alongside explosive growth in Internet commerce, generating
 parallel concerns about security and child protection. The state-of-the-art
 age verification system pioneered by Aristotle International was designed to
 address these issues and quickly became the industry leader, a challenge
 controversy-plagued ChoicePoint seemingly sought to overcome by the marketing
 claims made on its website. As part of an effort to expand online sales
 following a landmark Supreme Court decision overturning certain state
 prohibitions on interstate commerce in alcoholic beverages, a wine marketing
 group in California sought to enhance its competitive standing by promoting to
 current and would-be members a special deal with ChoicePoint by which its
 wineries could conduct online age verification to satisfy common "carding"
 requirements. The apparent misrepresentation of AG approval was offered as an
 inducement to buy the ChoicePoint service, something that sources say may have
 implications for future advertising claims by the company in the wine

SOURCE Aristotle International