Firm Abruptly Withdraws Claims Called False; ChoicePoint Statements Challenged by 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 International. 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 wineries. 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 industry.
SOURCE Aristotle International
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