Credit Card Issuers Have Never 'Sold' Data

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Editor's Note: This letter also was submitted to The New York Times.


Misrepresentation of financial service marketing practices is not constructive to the current national debate over privacy issues. Although Steve Lohr's July 15 article in The New York Times, "A Protective Path Paved in Granola," makes an interesting comparison of the environmental movement and the current national privacy discussion, any direct marketing professional would be concerned with Lohr's statement: "Merchants have been selling credit card data for years. The sure evidence of that is the annoying arrival of junk mail every day."


My experience in the credit card business over the past 20 years is that credit card issuers have never sold data. "Selling" is a word that should not be used lightly in this context.


To broaden the line of products available to their customers, consumer lenders make lengthy contractual agreements enabling product and service providers to market to their customers. These programs are highly supervised, as banks are very concerned about resulting customer comments and maintaining lending relationships. Problems seldom occur because all work under the guideline that banks have little organizational tolerance for missteps.


The majority of direct mail pieces that consumers receive relate to rental of their subscription, catalog purchase, donation, directory or public record information. Seldom is information "sold," which would indicate a terminal activity diminishing all equity from the original information owner. Of course, list rental is a means for direct marketers to earn incremental revenue allowing them to provide lower prices to their customers or conduct more charitable work.


Kenneth G. Kraetzer, Vice president, CBSI, Harrison, NY, Adjunct professor, Mercy College, Dobbs Ferry, NY


kkraetzer@cardholders.com

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