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Australian firm pauses facial recognition trial over privacy concern

SYDNEY, June 28 (Reuters) - Australia's second-biggest appliances chain said on Tuesday it was pausing a trial of facial recognition technology in stores after a consumer group referred it to the privacy regulator for possible enforcement action. Use of the technology by The Good Guys, owned by JB Hi-Fi Ltd JBH.AX, was "unreasonably intrusive" and potentially in breach of privacy laws, the group, CHOICE, told the Office of the Australian Information Commissioner (OAIC). "The Good Guys ... will pause the trial of the upgraded security system with the optional facial recognition technology being conducted in two of its Melbourne stores," a spokesperson for JB Hi-Fi said in an email. The company took confidentiality of personal information seriously and remains confident it had complied with relevant laws, but decided "to pause the trial at this time pending any clarification from the OAIC regarding the use of this technology", it added. The Good Guys was named in a complaint alongside Bunnings, Australia's biggest home improvement chain, and the domestic version of big box retailer Kmart, both of them owned by Wesfarmers Ltd WES.AX, with total annual sales of about A$25 billion across 800 stores. Bunnings was not immediately available for comment about The Good Guys' move. A day earlier, when CHOICE made its complaint, Bunnings said it only used the technology for security after an increase in the number of "challenging interactions" faced by its team and accused CHOICE of an "inaccurate characterisation". The Good Guys said it also used the technology only to review incidents of theft and ensure the safety and wellbeing of customers and its teams. Kmart did not respond to email inquiries about the complaint. The OAIC has said it is reviewing the complaint. Last year, the regulator ordered the Australian 7-Eleven chain to destroy "faceprints" collected at 700 convenience stores on iPads set up to run customer surveys. It also ordered U.S. software developer Clearview AI, which collects images from social media websites to build profiles of individuals, to destroy data and stop the practice in Australia. (Reporting by Byron Kaye; Editing by Clarence Fernandez) ((byron.kaye@thomsonreuters.com; +612 9171 7541; @byronkaye;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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