Big Brother is watching: firestorm follows report of sale of Mexicans' personal information to U.S. firm. (Special Report).

The investigation is still open, and it's not yet certain a law was broken. But, according to the Federal Electoral Institute, the suspect deal went down something like this:

In the spring of 2001, a Mexican marketing company, Bases de Datos Especializados, bought a diskette copy of what appeared to be Mexico's national voter registration. For 400,000 pesos, the company obtained names, birthdates, addresses, phone numbers and other personal information of nearly 60 million people.

The firm turned around and sold it to ChoicePoint, the self-described "leading U.S. supplier of identification and credential verification services," for US$250,000.

ChoicePoint, a firm based in an Atlanta suburb, had accumulated from similar purchases a database with information about hundreds of millions of Latin Americans--from Argentina, Brazil, Colombia, Costa Rica and other countries

Following the September terrorist attacks of that year, ChoicePoint offered the database to the U.S. government. In the midst of an intelligence crisis, as shaken institutions sought to develop a new plan to keep America's enemies from attacking her at home, the government was buying.

During the same period, reality television, specifically Televisa's Big Brother project, took off in Mexico. Millions of Mexicans had faithfully tuned in to watch the first season of the Orwellian nightmare turned mass entertainment. When the Associated Press first reported in April this year that a U.S. company had purchased the supposedly confidential files, the second season of Big Brother was in full swing, and people became concerned.

Some Mexicans and rights activists feared U.S. law enforcement would have the power to identify any undocumented Mexican living in the United States at the click of a button. Big brother was watching.

Not only had ChoicePoint bought voter registration records, but it also appeared to have purchased vehicle and driver registration records of the capital's residents. Federal law prohibits the misuse of voter data for non-electoral purposes, and motor vehicle data has similar protections.

QUESTION OF SOVEREIGNTY

In response to the AP report and the ensuing media blitz, the Interior Secretariat promised a full investigation. "This isn't the kind of information you want in the hands of a foreign government," said one spokesman. The Federal Electoral Institute (IFE), whose bureaucrats were first blamed, and whose reputation stood to be besmirched just as election season opened, filed a complaint with the Attorney General's Office and began its own internal probe.

Similar investigations were launched in other countries. In Nicaragua, police raided the offices of firms suspected of supplying similar data to ChoicePoint.

While the Attorney General's Office has yet to file any charges in the matter, the internal IFE investigation soon presented what it said was a clear trail of how the data got into ChoicePoint's hands.

Aided by information from ChoicePoint, on May 15 the IFE said the information had been copied by a consultant from an IT company working for the Interior Secretariat, who then sold the data to Bases de Datos Especializados, which in turn sold it to ChoicePoint. The IFE said no one from the electoral institute was involved in the sale.

The Interior Secretariat immediately denied it was the source of the leak, and as BUSINESS MEXICO went to press, the investigation continued.

The problem, said IFE councilor Gaston Luken, is that this supposedly confidential information is very public. At least 4,000 bureaucrats and party functionaries have access to the voter registration files.

Moreover, the company that sold the data to ChoicePoint also collected data from other sources, and it may be hard to pin down illegal use of the voter records.

But the IFE is still determined to resolve the case. Luken is worried the scandal will affect the public image of the electoral institute. "A lot of work has been done in creating an accurate voter registry and cleaning up the problems and abuses of the past."

ChoicePoint marketing director James Lee said the company has cooperated in the investigation. The company said it will be happy to stop using the information if it was obtained illegally, but claims the contract negotiations included verification that the data was obtained legally, and there is no reason to think differently until proved otherwise.

The company says it did not know it might have been buying restricted voter registration data. Instead, it thought it was obtaining perfectly unregulated market research.

But that doesn't satisfy Julio Tellez Valdes, a lawyer and data protection specialist at the Technological Institute of Monterrey. He points to copies of ChoicePoint documents-a list of services offered to U.S. immigration--that explicitly offers a "nationwide listing of all Mexicans registered to vote as of the 2000 elections."

FEELING NATIONALISTIC

Tellez is suspicious of the whole operation. He points out that ChoicePoint's management of the data files--they only sell the government access to the databases, not the data in full--allows the government to get around the U.S. Privacy Act of 1974, which restricts the government's use of such data.

"The United States wants to control us because we are its neighbors. We are indignant," he said. "We agree to let the Mexican government have access to this information, not the U.S. government."

Tellez claims the U.S. government's hunger for such data illustrates a "psychosis" developed following the 9-11 terrorist attacks.

"Mexicans are not terrorists, they go to the United States to work. This is totally unjust," he said.

Besides its core businesses of background checks and drug testing, ChoicePoint has been involved in such projects as identifying the remains of Sept. 11 victims, helping catch the Washington D.C., sniper, and, most recently, keeping sex offenders and drug addicts out of the Boy Scouts.

The firm is well connected politically. It has close ties to the Republican Party, the Bush administration, and former New York City Mayor Rudolph Guiliani. Former NYPD chief Howard Safir sits on the board of ChoicePoint, as does Guiliani's senate campaign fundraiser Ken Langone. Safir is a proponent of such high-tech gadgetry as "biometric facial imaging software," which can pick out a suspect's face among tens of thousands in a football stadium.

This isn't the company's first problem with voter rolls. The state of Pennsylvania terminated a contract with the company in 2000, after authorities discovered the firm had resold voter information. Even more controversial was the involvement of ChoicePoint in the 2000 presidential election. The firm's Florida subsidiary, DBT Online, was responsible for updating Florida's voting files before the 2000 election. Its data misidentified thousands of voters, most of them black, as felons, and removed them from the voter rolls. The Guardian of London has reported in detail on these errors--which may have reached 15% of the 57,000 "felons" identified by ChoicePoint.

Given security conditions, the U.S. government is reluctant to specify what they are doing with the data. ChoicePoint says it is used mostly for criminal investigations, not for tracking illegal migrants in the country. "That's just not technologically possible," says Lee.

That is it isn't possible yet, and that's what worries people like Tellez. He and many others are concerned about Mexico's lack of comprehensive legislation to regulate the amazing feats possible with modern database management.

Advocates of an information privacy law say Mexico should look to the strict regulations established in Europe, rather than the more lax regulation in the United States. While the Senate passed an information privacy law in 2001, it has been sitting in commission in the Chamber of Deputies ever since.

Tellez said lobbying on behalf of corporations, specifically American Express and Readers Digest, who thrive on using personal information databanks for their business, and the influence of other special interests were responsible for freezing the legislation.

STAY OUT OF MY BUSINESS

The Central Bank issued a report last year laying out the need for legislation and an independent body to monitor information societies' use of personal information databases. In Mexico, there is no legal right to request the information gathered about you by a credit rating agency, like the Buro de Credito, Tellez points Out.

"Without regulation and transparency, that can lead to all kinds of confusions and discrimination," he said.

While some privacy advocates lament that the legal framework governing personal data sales in the Americas is as lax as financial regulations governing offshore banking havens, Lee feels the continent just shares the same philosophy.

"In the United States, people have always been more worried about the government having too much information rather than private sector. It's the same throughout the Americas," he said.

ChoicePoint's stated goal is to make the world a safer place, and the firm believes its databases help the U.S. government reach this same end. As technology continues to develop, and fear continues to reign, ChoicePoint can look forward to big business.

"The most dangerous thing," Lee said, "is not knowing who someone is.

Michael O'Boyle is a Mexico City-based free lance writer.