Wal-Mart and the Right to Privacy

Listen up all Wal-Mart employees, contractors, critics and shareholders: The chain that promises great value places no value at all on your right to privacy (at least until recently, if you believe the company). In a Wall Street Journal article that broke on Wednesday, Bruce Gabbard, a Wal-Mart security worker fired for unauthorized phone-call recording and pager intercepts, took the lid off the discount chain's Threat Research and Analysis Group, with plenty of details that the Journal confirmed with other company sources and security experts.

Here are some of the lowlights (All quotes are from the Journal story):

* After 9/11, "Mr. Gabbard says he was directed by two former FBI agents working for Wal-Mart to set up a system that could track any calls to and from Syria, Yemen and Iran, among other countries. The search was unsuccessful, only flagging an apparent call from Iran that turned out instead to be from an Indian jeweler, according to Mr. Gabbard."

* "Concerned about the leaks, Wal-Mart began working with Oakley Networks Inc., a developer of 'insider threat management' gear to track employee and suppliers computer usage over its network, according to Mr. Gabbard and an industry source. One Oakley system is able to record an employee's computer keystrokes and deliver a TiVo-like replay of his or her computer activities, according to Tom Bennett, Oakley's vice president of marketing. ... The system goes beyond keystroke capture products and e-mail filtering packages by 'providing a view of content moving over your network,' says Oakley's Mr. Bennett."

* "Suspecting that the leaks of confidential memos might have come from McKinsey employees who had been working on a health-care project at Wal-Mart's Bentonville, Ark., headquarters at the time of the leaked memo, Wal-Mart's security experts used an Oakley device to monitor the McKinsey Internet activities, according to Mr. Gabbard and others."

* "Wal-Mart also used an Oakley product to monitor suppliers' use of the Wal-Mart network. Mr. Gabbard says that using the program that can monitor flesh tones on a computer screen, his team found a vendor downloading pornography and reported it to Wal-Mart and the vendor's executives."

* "Wal-Mart sent a long-haired employee wearing a wireless microphone to Up Against the Wal's Fayetteville, Ark., gathering, and eavesdropped from nearby, says Mr. Gabbard. 'We followed around the perimeter with a surveillance van,' he says."

* "Wal-Mart also directed its surveillance operations at critical shareholders. According to a January 2007 memo reviewed by The Wall Street Journal, security units were asked to 'do some preliminary background work on the potential threat assessment' of those submitting proposals to its June shareholder meeting, particularly those whose resolutions the company was trying to block.

As Gabbard says, "I used to joke that Wal-Mart paid me to be paranoid and they got their money's worth." Indeed. Wal-Mart's defense came in two parts:

One, these are standard, legal security measures that any big company uses.

Two, we're not doing it anymore.

The group "is no longer operating in the same manner that it did prior to the discovery of the unauthorized recording of telephone conversations," said Wal-Mart spokeswoman Sarah Clark. "There have been changes in leadership, and we have strengthened our practices and protocols in this area."

If true, it's not a moment too soon. "They should stop playing with spy toys and take the criticism of their business model seriously. The success of the company depends on it," said Nu Wexler, spokesman for Wal-Mart Watch, and one of the targets of surveillance.