What eventually becomes cutting-edge in retail and payments often originates in places that are dedicated to security, not commerce.
New technology often starts out at the U.S. Department of Defense (DOD) or NATO, for instance. Former Israeli intelligence agents or military members have taken the knowledge they gained during their service and contributed to artificial intelligence (AI), fraud prevention and other efforts that do make — or can end up making — a difference in the daily lives of consumers.
Now, the time might be right to at least consider adding prisons to that mix. Yes, prisons.
Let’s not get ahead of ourselves — there is little chance that any prison system will become a miniature Silicon Valley. However, recent news describing the use of voice-recognition technology to boost security and combat fraud behind bars — along with previous PYMNTS coverage about the spread of mobile transactions among prisoners — showed how those institutions could contribute to retail and payment advances in the outside world.
A report earlier this week from The Intercept detailed how prison operators in New York, Texas, Arizona, Florida and Arkansas are using — or want to use — voice prints from inmates (and, apparently, not always with the full knowledge of those prisoners).
“Prison authorities have quietly enrolled hundreds of thousands of incarcerated people’s voice prints into large-scale biometric databases,” the report said. “Authorities and prison technology companies say this mass biometric surveillance supports prison security and fraud prevention efforts.”
Those efforts come as voice-assistant and voice-activated technologies — different, of course, from voice-print biometrics — are having a moment in the retail spotlight. There are many recent examples of that, but those from the 2018 holiday shopping season are among the most telling. Amazon said that orders placed via Alexa were three times higher than the year-ago holiday shopping season.
In addition, the use of biometrics in retail and payments — especially for fraud prevention, but also in other areas — is becoming more popular, and solid use cases are starting to accumulate. A recent example of that was provided by Zwipe, a biometric payments company, which has raised $14 million in venture capital funding. Granted, that’s not the biggest funding round ever, but the company plans to use the funding to commercialize its technology, which embeds fingerprint readers in payment plastic for added security.
Much of the recent activity in retail and payments that involves biometrics has focused on facial recognition and selfies. Voice authentication is a relative outlier, but it has found use in the security efforts of financial institutions (FIs) and call centers in various forms. It’s difficult to say how the use of voice prints in U.S. prisons might advance that biometric authentication tool in the consumer world. However, the general project reportedly enjoys funding from the DOD, and it’s not beyond the realm of possibility that the lessons learned from the deployment of that technology in prisons will eventually influence future uses focused on consumers.
Prisons function as a relatively isolated economic system (at least for inmates), one where cash is almost always banned. Don’t go by what old movies say about how payments operate behind those bars — smoking bans have spread to prisons, making tobacco less of an item of trade than such items as stamps and protein (especially packaged fish, according to reports and analysts).
Prisoners are usually required to buy at least some products for daily living in the prison commissary, or via approved methods that allow online purchases from outside retailers (often companies that focus on retail sales to inmates), and those payments are usually done by cards or other non-cash methods. For prisoners who receive income from relatives and friends, and through wages for prison labor, those funds are deposited into inmate accounts, which often have maximum limits. When it comes to those wages, the amounts vary state to state, but the typical range is between $0.33 and $1.41 per hour.
As one can imagine, prison is not absent of payments fraud, and that includes cons and thefts tied to digital retail and payments technology.
That was the case last year in the U.S, when the JPay service — an electronic payments, financial services and communications system, designed specifically for use inside prisons — was hacked by inmates in Idaho, who reportedly ran up more than $224,000 in improper credits to their prison accounts. In November, reports emerged about prisoners working since 2015 to rip off U.S military members, using online dating sites to con those consumers into wiring cash to inmates — a con not unlike those that are increasingly targeting senior citizens, as PYMNTS recently covered.
Additionally, as isolated as prisons are from the daily lives of most consumers, retail and payment trends do find their way into those institutions. Recent events in China and the U.K. demonstrated that.
Mobile and digital payments are making inroads into penitentiaries around the world. That’s not only for money going into prisons to help inmates purchase toiletries, foods and other products. The emerging trend also applies to funds going out of prisons — disbursements from prisoners who sometimes send home some of their wages for birthday gifts and other uses. The spread of digital payments within the world of prisons, however, is not without fraud.
The use of voice prints in prisons is reportedly raising civil rights concerns. That’s pretty much outside the scope of PYMNTS coverage, but is worthy of note. The rise of biometrics in payments and commerce — and the ongoing mainstreaming of facial recognition in particular — brings with it lawsuits and the whole scope of legal wrangling that will shape how those tools are used.
In late January, for instance, the Illinois Supreme Court ruled that a teen can sue Six Flags amusement park over the violation of an Illinois privacy law, in a case that could have repercussions for tech giants like Google and Facebook. That suit stems from the scan of a park visitor’s thumbprint for season pass entry. Were inmates or civil liberty organizations to file suit over the use of voice prints in prison, rulings made in those cases could also play a role in the use of biometrics in the days to come.
That’s in the future, and verges on the speculative. Yet, the news about voice prints and prison reminds us all that some of the technology and experiments that can one day influence retail and payments come from unlikely places.