The Audit

David Clinton

You’ve certainly been asked (begged!) to join up for at least one loyalty “points” program – like PC Optimum, Aeroplan, or Hilton Honors – over the years. And the odds are that you’re currently signed up for at least one of them. In fact, the average person apparently belongs to at no less than 14 programs. Although, ironically, you’ll need to sign up to an online equivalent of a loyalty program to read the source for that number.

Well all that warm, fuzzy “belonging” comes with some serious down sides. Let’s see how much they might cost us.

To be sure, there’s real money involved here. Canadians redeem at least two billion dollars in program rewards each year, and payouts will often represent between one and ten percent of the original purchase value.

At the same time, it’s estimated that there could be tens of billions of unredeemed dollars due to expirations, shifting program terms, and simple neglect. So getting your goodies isn’t automatic.

Just why do consumer-facing corporations agree to give away so much money in the fist place?

As you probably already know, it’s about your data. Businesses are willing to pay cold, hard cash in exchange for detailed descriptions of your age, sex, ethnicity, wealth, location, employment status, hobbies, preferences, medical conditions, political leanings, and, of course, shopping habits.

Don’t believe it works? So then why, after all these years, are points programs still giving away billions of dollars?

Every time you participate in such a program, the data associated with that activity will be collected and aggregated along with everything else known about you. It’s more than likely that points-based data is being combined with everything connected to your mobile phone account, email addresses, credit cards, provincial health card, and – possibly – your Social Insurance number. The depth and accuracy of your digital profile improves daily.

What happens to all that data? A lot of it is shared with – or sold to – partners or affiliates for marketing purposes. Some of it is accidentally (or intentionally) leaked to organized criminal gangs driving call center-related scams. But it’s all about getting to know you better in ways that maximize someone’s profits.

One truly scary way this data is used involves surveillance pricing (also known as price discrimination) – particularly as it’s described in a recent post by Professor Sylvain Charlebois.

The idea is that retailers will use your digital profile to adjust the prices you pay at the cash register or when you’re shopping online. The more loyal you are as a customer, the more you’ll pay. That’s because regular (“loyal”) customers are already reliable revenue sources. Companies don’t need to spend anything to build a relationship with you. But they’re more than willing to give up a few percentage points to gain new friends.

I’m not talking about the kind of price discrimination that might lead to higher prices for sales in, say, urban locations to account for higher real estate and transportation costs. Those are just normal business decisions.

What Professor Charlebois described is two customers paying different prices for the same items in the same stores. In fact, a recent Consumer Reports experiment in the U.S. involving 437 shoppers in four cities found the practice to be quite common.

But the nasty bit here is that there’s growing evidence that retailers are using surveillance pricing in grocery stores for basic food items. Extrapolating from the Consumer Reports study, such pricing could be adding $1,200 annually to a typical family’s spending on basic groceries.

I’m not sure what the solution is. It’s way too late to “unenroll” from our loyalty accounts. And government intervention would probably just end up making things worse.

But perhaps getting the word out about what’s happening could spark justified mistrust in the big retailers. No retailer enjoys dealing with grumpy customers.

Be grumpy.

A young journalist has uncovered perhaps the largest fraud scheme in US history. 

He certainly isn’t a polished reporter with many years of experience, but 23 year old independent journalist Nick Shirley seems to be getting the job done. Shirley has released an incredible video which appears to outline fraud after fraud after fraud in what appears to be a massive taxpayer funded scheme involving up to $9 Billion Dollars.

In one day of traveling around Minneapolis-St. Paul, Shirley appears to uncover over $100 million in fraudulent operations.

🚨 Here is the full 42 minutes of my crew and I exposing Minnesota fraud, this might be my most important work yet. We uncovered over $110,000,000 in ONE day. Like it and share it around like wildfire! Its time to hold these corrupt politicians and fraudsters accountable

We ALL… pic.twitter.com/E3Penx2o7a

— Nick shirley (@nickshirleyy) December 26, 2025