Rite Aid banned from using facial recognition technology in stores for five years

Rite Aid has been banned from using facial recognition technology for five years over allegations that its surveillance system was used incorrectly to identify potential shoplifters, especially Black, Latino, Asian or female shoppers.

The settlement with the Federal Trade Commission addresses charges that the struggling drugstore chain didn’t do enough to prevent harm to its customers and implement “reasonable procedures,” the government agency said.

Rite Aid said late Tuesday that it disagrees with the allegations, but that it’s glad it reached an agreement to resolve the issue. It noted in a prepared statement that any agreement will have to be approved in U.S. Bankruptcy Court.

Rite Aid announced last fall that it was closing more than 150 stores as it makes its way through a voluntary Chapter 11 bankruptcy process.

Rite Aid Corp., based in Philadelphia, has more than 2,000 locations. The company has struggled financially for years and also faces financial risk from lawsuits over opioid prescriptions like its bigger rivals, CVS and Walgreens.