Originally created 05/03/04

Q&A with ChoicePoint boss Derek Smith



ChoicePoint Inc. chairman Derek Smith hopes to prompt debate about the balance of security and liberty in America. Here are highlights of an interview he gave to The Associated Press.

AP: You say database technologies can restore some of the security once associated with small-town America. Might that ideal be overly colored by nostalgia? And how do we guard against eventually starting to believe that almost any risk can be detected with the right information about previous behavior? There's always a time when a criminal commits his first crime.

SMITH: I think the first thing is, what can we do to solve the issues that exist today? There are many things that are happening in the world around us that we should know about it. We know what the specific risk is, we know the data's available to mitigate that risk. We know that if somebody goes to work in a day care center, that there's children there and sexual predators at some point may go to seek out that venue as way to find children. We know there's information about who some of those sexual predators were, what their criminal history, some other facts about their lives. We know we can use that to screen people, and if we do screen it, it will mitigate that risk. And so consequently, today, there are risks that are out there that either we've ignored or that we really haven't dealt with, that information can already provide ... tremendous changes in that risk curve. Part Two is, we're talking about creating a safer, more secure society, not a safe society. ... It's not realistic to believe that technology in any way is going to completely create this safe cocoon that we all might wish to be a part of. ... But the sense of community, understanding, knowledge, insight and communication was there. That's what I'm trying to suggest we've got to redo. But it's going to have to come technologically or electronically because we don't live in a small town any more. We don't know our neighbors. We don't know people that are around us. And many people don't want to.

AP: A lot of attention has been paid to the fact that database mining could have sniffed out the relationships and other suspicious factors about the Sept. 11 hijackers. But what if the next group of terrorists is more careful about establishing links to each other that can be detected electronically? Do our lives generate so much detailed data that it's virtually impossible for interconnections between people to go undetected?

SMITH: It's very hard for you to live a normal life in our society where you won't interact in some kind of electronic format. ... If you are here in this country and you've said you've been here for a five-year period of time, then you should have conducted yourself in a certain way over that five-year period of time. You've probably done certain things in society. If you can't find any representation that that took place, then it raises a flag ... because it's way outside the bounds of normal behavior.

AP: Is it possible that increasingly prevalent background checks on people could erode the traditional American notion that we are free to move on, start anew, reinvent ourselves? Or is that an outdated concept?

SMITH: I think as a society it's OK to forgive, but we shouldn't forget. And in that, I mean, the fact that you committed a crime against society, you've done something wrong, is a fundamental fact of who you are. But if you've also gone five years, 10 years, whatever the appropriate period is, and lived a model life, then that's actually a very positive characteristic of who you are and what you've done. ... The issue is, have you openly disclosed who you are and what you've done, and is society choosing to forgive you and then move on? But to pretend that you've decided now it's no longer a relevant factor that you molested a child, because you've "moved on," and you know you're a better person, you don't have, I don't believe, the universal or unilateral right to deem what I think is a relevant factor to who you are. But I do believe in redemption. I do believe people make mistakes and they become better people as a result of it. What you've got to separate out is those people from those people who are in essence habitual criminals or have a long-term problem in terms of their interaction with society.

AP: You suggest that people guard against identity theft and erroneous record-keeping by regularly checking credit reports and other electronic sources. So why not let all Americans check the data ChoicePoint has on them for free, say, once a year?

SMITH: There is not a massive central database you can come into and "check" whether or not the data is legitimate. There is a cost to aggregate this stuff together and present it in a usable way. So unfortunately, to provide that for free would destroy the ultimate economics of our ability to do business. It's not simply, "Here's a database, push F3, and we'll give you all the information we have, please correct it and bring it back." That's really not what we do. We're a data aggregation firm, really not a massive database firm. ... A lot of what we do, you could do yourself, but you'd have to go to 40 different places to do it. That's very time consuming, and in the end would be very expensive for you to do it.

AP: To enact your vision of society using information more intelligently to mitigate risk, might laws need to be changed, like the 1974 Privacy Act, which limits what government can do with personal data on citizens?

SMITH: If we can have an informed discussion - where people can do it on a rational basis and put a little bit of the ideology of extremism away - then I believe the end result will be a change in either laws or regulations, over time, that will give people a better sense of comfort and security about how the information's used. What I fear, though, is it denigrating into a very emotionalized, hypothetical argument, and then people try to somehow shut off access to data instead of debate the usage of data. ... I think we can solve 80 percent of the issues. Now we're not going to solve 100 percent of 'em, but you see we have no basis to have the dialogue today ... I think if we get this legitimate approach in first, then we'll have a foundation that will withstand the next attack, or the next issue or whatever else it happens to be.

Smith Bio

NAME - Derek V. Smith.

BORN - 1955 in Bayport, N.Y.

EDUCATION - Undergraduate degree in 1977 in computer science from Penn State University, where he was a reserve wide receiver for legendary football coach Joe Paterno. Master's in business administration in 1979 from Georgia Tech.

CAREER - Held executive positions at Equifax before leading spinoff of ChoicePoint, where he is chairman and CEO. Got $8 million in salary, bonus, perks and stock in 2003. Smith also owns or has options for up to 3.6 million ChoicePoint shares, a stake that would be worth more than $150 million.

FAMILY - He and his wife, Lisa, have a daughter, Hanley, and a son, Tanner.

QUOTE - "We want to be viewed as the most admired information company in the world. And to do that, we're going to have to win the battle of trust."