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Internet Shoppers More Worried About Online Pickpockets

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By ANICK JESDANUN, The Associated Press

Published: January 17, 2008

NEW YORK - Privacy concerns stemming from online shopping rose in 2007, a new study finds, as the loss or theft of credit card information and other personal data soared to unprecedented levels.

Sixty-one percent of adult Americans said they were very or extremely concerned about the privacy of personal information when buying online, an increase from 47 percent in 2006. Before last year, that figure largely had been dropping since 2001.

People who do not shop online tend to be more worried, as are newer Internet users, regardless of whether they buy things on the Internet, according to the survey from the University of Southern California's Center for the Digital Future.

The study comes as privacy and security groups report that an increasing number of personal records are being compromised because of data breaches at online retailers, banks, government agencies and corporations.

The Identity Theft Resource Center, for instance, listed more than 125 million records reported compromised in the United States last year. That's a sixfold increase from the nearly 20 million records reported in 2006.

Data breaches often result from lost or stolen computer equipment such as laptops, though the single largest breach was a case of online hacking. Early last year, TJX Cos. disclosed that a data theft had exposed tens of millions of credit and debit cards to potential fraud.

The card numbers were typically collected during brick-and-mortar retail transactions at T.J. Maxx, Marshalls and other TJX chains. The breach is thought to have started when hackers intercepted wireless transfers of customer information at two Marshalls stores in Miami - an entry point that led the hackers to break into TJX's central databases.

Nonetheless, concerns about credit card security have largely stabilized, with 57 percent very or extremely concerned last year. It was 53 percent in 2006, a difference close to the survey's margin of sampling error of 3 percentage points in either direction.

As of 2007, two-thirds of adult Internet users shop online, compared with just half a year earlier. Most spend $100 or less a month, and two-thirds of online shoppers have reduced buying at brick-and-mortar stores.

"You'd think the logical attitude would be to look at this level of concern and say I'm not going to shop on the Web, but it's not happening," said Jeff Cole, director of the Center for the Digital Future. "The advantages, the conveniences are so extraordinary."

With credit card fraud, a customer's liability is capped at $50; that amount often is waived. Customers may spot fraudulent charges quickly if they check their accounts online or are notified by their banks, which have security measures in place to flag suspicious transactions.

Identity theft, on the other hand, can take months and sometimes years to find out about and resolve, Cole said, possibly explaining the greater concern over privacy.

Among other findings in the annual survey, online parents are more likely than ever to withhold Internet use as punishment - 62 percent in 2007, compared with 47 percent a year earlier and 32 percent in 2000. For the first time, denying Internet access is on par with banning television for bad behavior.

Nearly two-thirds of parents worry about kids participating in online communities, and about half think online predators are threats, notwithstanding other research showing fewer youths receiving sexual solicitations over the Internet as they become smarter about where and with whom they hang out online.

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