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MoneysOctober 21 2015

The UK’s largest registered online pharmacy, Pharmacy2U, has been fined £130,000 for selling details of 20,000 customers to marketing companies. Data was being advertised for sale at £130 per 1,000 records.

The civil monetary penalty is the first of its type, and has been imposed because Pharmacy2U was found to have breached the first principle of the Data Protection Act regarding fair and lawful processing of data.

An investigation by the Information Commissioner’s Office found that 100,000 customer details had been advertised for sale through an online marketing list company, Alchemy Direct media (UK) Ltd. The database was advertised as including people suffering from various conditions including asthma, Parkinson’s disease, hair loss, diabetes, heart disease, and erectile dysfunction, and the data could be profiled by customer age and gender.

The ICO investigated the matter after the Daily Mail ran a news report. The ICO found that “Pharmacy 2U had not informed its customers that it intended to sell their details, and that the customers had not given their consent for their personal data to be sold on. This was in breach of the Data Protection Act.”

Companies buying the data had included a health supplements business which has been cautioned for misleading advertising, and an Australian lottery company. This “appeared to have deliberately targeted elderly and vulnerable individuals, and it is likely that some customers will have suffered financially as a result of their details being passed on.” The lottery company is subject to an investigation by Trading Standards.

ICO Deputy Commissioner David Smith commented: “Patient confidentiality is drummed into pharmacists. It is inconceivable that a business in this sector could believe these actions were acceptable. Put simply, a reputable company has made a serious error of judgement, and today faces the consequences of that. It should send out a clear message to other companies that the customer data they hold is not theirs to do with as they wish.

“Once people’s personal information has been sold on once in this way, we often see it then gets sold on again and again. People are left wondering why so many companies are contacting them and how they come to be in receipt of their details.”

The ICO monetary penalty notice sets out the breach as it relates to the Data Protection Act. It says that the contravention was because Pharmacy2U had “obtained personal data unfairly because its online registration form and privacy policy did not inform its customers that it intended to sell their details to third party organisations, in addition to sending out its own marketing material.

“It would not be within a customer’s reasonable expectation that this form of disclosure would occur, even if they were willing to agree to the receipt of marketing material from Pharmacy2U itself. If a customer wished to take up Pharmacy2U’s offer to opt out of ‘Selected company data sharing’, they also had to go to the trouble of logging into their account and changing the setting.”

After the civil monetary penalty was announced, Daniel Lee, Managing Director of Pharmacy2U, said: “This is a regrettable incident for which we sincerely apologise. As a responsible company, we undertook due diligence to check that the organisations intending to use the data were reputable.

“There was no publicly available information at the time to suggest that the lottery company was suspected of any wrongdoing and we have confirmed with the relevant authorities that they were validly licensed. The ICO has recognised in its monetary penalty notice that Pharmacy2U would not have known that there were any questions over the lottery company’s reputation. There was no publicly available information at the time that there had been a complaint to the ASA [Advertising Standards Authority] about Healthy Marketing Ltd.

“While we are grateful that the ICO recognise that our breach was not deliberate, we appreciate this was a serious matter. As soon as the issue was brought to our attention, we stopped the trial selling of customer data and made sure that the information that had been passed on was securely destroyed. We have also confirmed that we will no longer sell customer data.

“We take our responsibilities to the public very seriously and want to reassure our customers that no medical information, email addresses or telephone numbers were sold. Only names and postal addresses were given, for one-time use.”

Pharmacy2U has changed its privacy policy to highlight that it will no longer sell customer data and has implemented a prior consent model for its own marketing.

Links:

ICO announcement

ICO Monetary Penalty Notice

Pharmacy2U statement

Pharmacy2U Privacy policy

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