By James Plummer

New information has emerged this past week about the MATRIX database system, supposedly a state-level program that digs through commercial and government databases that allegedly can “spot terrorists.” It turns out that the program received support from the federal government – and that Florida authorities followed up and investigated a list of 120,000 people deemed to have a “high terrorist factor.”

The Washington Post reports that Hank Asher, founder of Seisent, Inc. and former drug smuggler, demonstrated his MATRIX system in the White House in January 2003. And according to the ACLU, which obtained the documents revealing the White House demonstration, other documents indicate that the Department of Homeland Security (DHS) played “a central role not only in funding this program, but also in managing it.”

And indeed, a document from the New York State Police reveals that in exchange for $8 million in funding, MATRIX officials agreed to cede to DHS the right to “maintain managerial oversight and control” of the MATRIX program.

Initiatives like the MATRIX program, which gather credit history, phone records and other consumer data, undermine consumer participation in the marketplace by providing a chilling effect when it comes to dealing with and entrusting sensitive data to businesses. For though consumers are well served when business can know and serve their preferences, they are not well served when the transactional data is bought or otherwise obtained by a government program that names a significant fraction of the population as probable terrorists.

It’s also worth pointing out that when individuals deal in the marketplace, they have an option of whether or not to entrust their sensitive data to shady smuggling characters – this is not an option when it comes to data caught up in the Homeland MATRIX.

Those governors and others who have pulled their states out of the program should be commended. Anyone contributing to this travesty and misuse of what the Post characterized as "20 million commercial records" should be considered this week's Privacy Villain.

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