Internet users ignorant about data privacy

Internet users in the United States are dangerously ignorant about the type of data that website owners collect from them and how that data is used, making them vulnerable to fraud and misuse of their personal information, a new study finds.

For the study, titled "Open to Exploitation: American Shoppers Online and Offline," 1,500 adult U.S. Internet users were asked true-or-false questions about topics such as website privacy policies. The survey was conducted by the University of Pennsylvania's Annenberg Public Policy Center and released last month.

Respondents generally failed the test, answering an average of seven out of 17 questions correctly. The study's interviews, conducted between early February and mid-March, yielded findings the authors consider alarming, including:

- 75 percent wrongly believe that if a website has a privacy policy, users' information will not be shared with third parties.

- 49 percent can't identify "phishing" scam e-mail messages, whose designs mimic the legititimate companies they purport to represent in order to lure users into entering sensitive information such as Social Security numbers.

- 68 percent can't name any of the three credit reporting agencies that enable consumers to monitor for attempts at identity theft.

To address the problems identified in the study, the authors propose increased consumer education, as well as new regulations requiring retailers to disclose what data they have collected about customers and when and how they will use it. In addition, it suggests replacing the term "Privacy Policy" used by most websites with the label "Using Your Information" to combat users' misconception that these documents are pledges not to share customer information.