Secure transactions -- with a tradeoff
Online wallets add a layer of security by ensuring your purchasing activities only occur on SSL-enabled Web sites.
In addition, some wallets offer extra security features, which may or may not stop the most persistent hackers. For example, Yahoo! Wallet restricts consumer purchases to its secure.yahoo.com domain and protects your account with a personal security password. AOL Quick Checkout also limits your shopping to its secure domain.
Using online wallets for increased security, however, may force you to give up consumer privacy. Microsoft Passport alone has an estimated 100 million consumers in their database, including their names, credit card numbers, and e-mail addressesââ,¬"valuable information to any e-commerce site (or worse, hackers). While your username and password won't be shared with Passport-affiliated sites, your e-mail address will be shared whenever you log in to a Passport site.
Microsoft's privacy policy claims members control their identities by choosing which sites they log in to, as well as choosing what information to divulge in their Passport profiles.
In addition, Microsoft admits that sending e-mail on the "behalf of participating Web sites" is fair game. Microsoft also states that it will occasionally send out members' demographic information, reporting the average age, gender, and other statistics, to its participating Web sites. And according to its fine-print, Microsoft can rightfully send you promotional e-mails from their merchant sites as part of its service.
Microsoft also sneakily shares your Passport profile with all of its owned sites. If you enter any part of Microsoft's MSN network, you will be automatically signed in, and your Passport profile (excluding your wallet information) will also be shared with each area of MSN. Imagine the worst case scenario where a Passport user unwittingly traipses through Expedia for airline tickets, then Money Central for retirement planning tips, and finally, to Slate for the latest politics headlines. Your Web surfing habits, future potential plans, preferences, and profile are now compiled into a large information network managed by, of course, Microsoft.
Even if you are outside of Microsoft-owned sites, choosing the automatic sign-in option to Passport will share your profile with every Passport-affiliated site you visit. Microsoft claims it's up to you to check out every site's privacy policy before choosing the automatic sign-in to Passport.
