FTC Says No To RTO Companies Snooping On Customers
September 26, 2012

Rent-To-Own Companies Caught Snooping On Their Customers

Michael Harper for redOrbit.com — Your Universe Online

It makes sense when you think about it. As a rent-to-own appliance shop, you want to make sure the equipment being rented is in a nice home, protected and safe. However, since life doesn´t always work out that way, it would also be nice to know where these rented machines are located when the renter falls behind on payments. So, in theory, placing a little harmless spyware on machines doesn´t sound too evil, does it?

Well, as it turns out, when you store a renter´s information – usernames, passwords and the like – via key logger and take pictures of the renter and the renter´s inner sanctum via laptop camera, you can gather much more information than you might have first assumed.

Seven of these rent-to-own companies have been called out by the Federal Trade Commission for using a piece of software called PC Rental Agent to protect their rental desktops and laptops. According to the complaint, PC Rental Agent, created by Pennsylvania company DesignerWare, captured and logged renters´ personal information, logged their keystrokes and even took pictures of the renters while they were in their homes.

Some of these renters, of course, just so happened to be in various stages of undress or engaged in amorous activities.

“An agreement to rent a computer doesn´t give a company license to access consumers´ private emails, bank account information, and medical records, or, even worse, webcam photos of people in the privacy of their own homes,” said FTC Chairman Jon Leibowitz in a statement. “The FTC orders today will put an end to their cyber spying.”

These orders, by the way, come as a result of a simple settlement made between the FTC, DesignerWare and the 7 RTO companies which bans the use of “Detective Mode,” the part of the software which logged keystrokes and took candid snaps of the customers. These RTO companies will be able to continue using geolocation to track their customers, as long as the customer ticks a box to agree to being tracked. Furthermore, RTO companies can no longer use these sorts of illegal data collecting methods to hunt down late or missed payments.

In a 2011 case, one young couple was shocked to find RTO company Aaron´s Inc. had used DesignerWare´s software to collect information from their email inbox as well as track their online activities and even snap pictures of the couple using the laptop.

This couple had no idea they were being tracked until an Aaron´s manager had come to their house to personally repossess the laptop as a result of non-payment. This manager showed the couple a picture of them using the laptop taken by the installed webcam. According to the lawsuit, the manager told the young couple that he wasn´t supposed to disclose that his company had the picture.

"They never explained why they were taking the webcam photos," said Brian Byrd, 26, who entered into the RTO program to buy a laptop for his wife. "The just walked in trying to be big shots."

As it turns out, the Byrds had realized 3 months into their lease that it made more sense to make one last, lump-sum payment and buy the computer right out. The employee that took their last payment, however, had a tendency to walk away with large amounts of cash. As such, the manager assumed the Byrds were behind on payments and tracked them down using the DesignerWare tracking program.

The settlement between the FTC and these companies is subject to public comment for 30 days, then the agency will decide if they should finalize the settlement.