The issue raised by this article is discussed in a broader context in the excellent book by Cathy O'Neil: "Weapons of Math Destruction: How Big Data Increases Inequality and Threatens Democracy".
The dangers of proprietary, secret algorithms making judgements at critical junctures (e.g whether a person is sentenced or not) is raised in the introduction of the book.
The book also gives copious concrete examples of these dangers. In particular, the book describes the LSI-R (Level of Service Inventory-Revised) questionnaire and how it effectively pinpoints race even though it does not actually ask for the person's race, which is illegal.