[Code of Federal Regulations]
[Title 16, Volume 1]
[Revised as of January 1, 2006]
From the U.S. Government Printing Office via GPO Access
[CITE: 16CFR14.12]

[Page 127]
 
                     TITLE 16--COMMERCIAL PRACTICES
 
                   CHAPTER I--FEDERAL TRADE COMMISSION
 
PART 14_ADMINISTRATIVE INTERPRETATIONS, GENERAL POLICY STATEMENTS, AND 
ENFORCEMENT POLICY STATEMENTS--Table of Contents
 
Sec. 14.12  Use of secret coding in marketing research.

    (a) The Federal Trade Commission has determined to close its 
industry-wide investigation of marketing research firms that was 
initiated in November 1975, to determine if the firms were using 
questionnaires with invisible coding that could be used to reveal a 
survey respondent's identity. After a thorough investigation, the 
Commission has determined that invisible coding has been used by the 
marketing research industry, but it is neither a commonly used nor 
widespread practice. Moreover, use of the practice appears to have 
diminished in recent years. For these reasons, the Commission has 
determined that further action is not warranted at this time.
    (b) However, for the purpose of providing guidance to the marketing 
research industry, the Commission is issuing the following statement 
with regard to its future enforcement intentions. The Commission has 
reason to believe that it is an unfair or deceptive act or practice, 
violative of section 5 of the Federal Trade Commission Act (15 U.S.C. 
45) to induce consumers to provide information about themselves by 
expressly or implicitly promising that such information is being 
provided anonymously, when, in fact, a secret or invisible code is used 
on the survey form or return envelope that allows identification of the 
consumer who has provided the information.
    (c) While the Commission has made no final determination regarding 
the legality of the foregoing practice, the Commission will take 
appropriate enforcement action should it discover the practice to be 
continuing in the future, and in the event that it may be causing 
substantial consumer injury. Among the circumstances in which the 
Commission believes that the use of secret coding may cause significant 
consumer harm are those in which:
    (1) A misleading promise of anonymity is used to obtain highly 
sensitive information about a consumer that such consumer would not 
choose to disclose if he or she were informed that a code was being used 
that would allow his or her name to be associated with the response; and
    (2) Information of any sort is used for purposes other than those of 
the market survey.

[43 FR 42742, Sept. 21, 1978]