Evan Schuman's StorefrontBacktalk

With all the attention on the closing of almost 400 remaining Borders stores, the chain's IT jewel—purchase history and other CRM data on tens of millions of its customers—is still to be sold to the highest bidder. When that happens, any privacy promises Borders made to loyalty-program customers are out the window. But if the CRM data is misused by the buyer, that could still spark a legal crackdown on what retailers can do with the information customers give them.

Unfortunately, bankruptcy courts really don't care what promises were made to collect CRM data—it's an asset, so it's for sale. Unless retailers can find a way to enforce customer privacy even after the retailer has gone belly-up (something no retailer wants to think about in creating a loyalty program), there's a very real risk of losing customer trust—and gaining the unwanted attention of politicians who have discovered that privacy is now a popular buzzword.

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