We've experienced the following scenario when checking out of our favorite stores with cards.
Customer: [Hands over card to purchase item]
Sales associate: What is your ZIP code?
Customer: [Mindlessly sounds off five digit number]
Sales associate: [Enters it into the system]
It's this transaction that's landed Urban Outfitters and sister company, Anthropologie, in its latest lawsuit. A class-action complaint was filed late last month by a Washington D.C.-based firm against the Navy Yard-based retailer. Perry Charnoff PLLC claims in its suit that Urban is violating consumer protection laws by misleading shoppers into thinking ZIP codes are required to complete credit card purchases. In D.C., this form of "misleading shopping" is illegal, reports BuzzFeed which first broke the story.
But this case is two-fold: The ZIP code information obtained during transactions is also used to covertly get a hold of customers' home and business information, which is then sold to third parties for marketing use. Aside from the mere annoyance of having one's information distributed to third parties which could potentially wield to unwanted soliciting and marketing calls, consumer data collection could also lead to identity theft!