Bunnings and Kmart are being investigated by the privacy watchdog for their use of facial recognition technology in stores.
Last month, the consumer advocacy group, CHOICE, revealed Kmart, Bunnings and The Good Guys had been capturing the biometric data of their customers.
On Tuesday, the Office of the Australian Information Commissioner (OAIC) revealed it has opened an investigation into the personal information handling practices at Bunnings and Kmart.
The OAIC said the investigation would focus on the companies' use of facial recognition technology, which captures images of shoppers' faces and stores unique "faceprints".
Preliminary inquiries into the Good Guys also commenced, following reports the tech company had paused its use of the facial recognition technology.
In a statement to Yahoo News Australia, a spokesperson for Kmart confirmed the company was aware of the investigation.
"We are aware of OAIC’s investigation into the use of facial recognition technology in some of our stores and we will cooperate with them," the spokesperson said.
"As we have previously stated, our trial of the use of this technology in some stores was for limited purposes including loss prevention and we have strict controls around its use."
Yahoo News Australia has contacted Bunnings for comment.
In a statement to AAP on Tuesday, Bunnings chief operating officer Simon McDowell said the company was aware of the opened investigation and would cooperate with the watchdog.
"As we've previously explained, this technology is used solely to help keep team and customers safe and prevent unlawful activity in our stores and we have strict controls around its use," he said.
Facial technology could breach privacy laws
As part of their investigation, CHOICE questioned 25 companies to see if they use facial recognition technology and their privacy policies were analysed.
The use of the facial recognition technology at Kmart, Bunnings and the Good Guys angered consumers.
The information collected by the technology could be in breach of Australia's privacy laws, CHOICE consumer data advocate Kate Bower said.
"(The Privacy Act) requires that your collection of that information has to be suitable for the business purpose that you're collecting it for, and that it can't be disproportionate to the harms involved," she said in a statement.
"We believe that these retail businesses are disproportionate in their over-collection of this information, which means that they may be in breach of the Privacy Act."
Simon McDowell, Bunnings' chief operating officer told CHOICE the technology was used at select stores and it was used to identify persons of interest "who have previously been involved in incidents of concern in our stores".
He said it was used to enhance safety and said customers were alerted to the technology with signage at store entrances.
In response to CHOICE's report, Mr McDowell said Bunnings was "disappointed" by the "inaccurate characterisation" of the facial recognition technology which was used.
Most shoppers unaware of 'creepy' technology
More than 1000 Australians were asked by CHOICE if they were aware of companies using facial recognition technology.
The majority of the respondents — 76 per cent — said they were not aware of retailers using the technology.
"Those who suspected it was being used wrongly named Coles and Woolworths as the most likely culprits," CHOICE said in the report.
"Some survey respondents describe facial recognition technology as 'creepy and invasive'. Others say they consider it 'unnecessary and dangerous' and wouldn't want to enter a store that's using it."
Two-thirds of the respondents said they were concerned about retailers using facial recognition technology and 78 per cent were concerned with the secure storage of faceprint data.
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