“Can I have your ZIP code please?” is a question Americans are used to hearing as they check out at many of the major retailers in the US. And for years, few people have bothered to ask why or say no. A recent court ruling in California’s Supreme Court, however, has made it illegal to ask this question during a credit card transaction as it could be used illegally for the purposes of credit card fraud and identity theft.
ZIP codes are generally used by retailers for market research and marketing strategy and are most often assigned to a group and not an individual. Even so, the information is part of the customer’s address which is covered by California’s Credit Card Act of 1971. The law in this area has for a long time been vague and many retailers have been caught off guard by the prospect of paying out damages.
The most important question remaining is whether this ruling will only be applied to future cases. The penalties to be paid out could be devastating with many of the companies having no idea they were breaching privacy laws.