E-Commerce Times Talkback
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In most parts of the country, it was a news item that was easy to miss, but it was front
page news in New Orleans when Lawrence E. Williams became the first person tried under the
1998 federal identity fraud statute. In all, Williams, 22, was charged with 14 counts
of identity fraud.
When it became clear that he was destined for federal prison, Williams copped a plea
and legal experts predict he will spend a maximum of five years in prison. The maximum
penalty under the federal identity fraud law is 15 years in prison and a US$250,000 fine.
Ask any of the New Orleans movers and shakers whose personal information Williams stole
if even the maximum punishment would have been enough. The collective frustration among
them is palpable.
How many people have actually been victims of identity fraud? There are occasional high-profile news stories such as this one that make it to a section on privacy for the program "60 minutes" on television. I saw this story reported in the "technology" section of my local paper as well, but there are millions of people concerned about the issue. Debates rage about solutions and "Identity Fraud Protection Kits" are available online. The FBI offers an identity fraud web site. Stories pop up every once in a while.
The question is simply, "How many victims are there?" I've suffered this problem myself. Credit bureaus offer canned responses, the Justice Department sent me a nice little booklet telling me how to protect myself, my bank refuses to discuss it beyond the obvious account balance as to their findings, the FBI gave me a case number and I never heard from them again, my police report sits inactive. Nobody is talking but me.
No wonder people are concerned. No action is taken, no findings disclosed to the victims, no solutions offered. We see news stories and say, "Yeah, that happened to me."
The problem here wasn't the internet. As a bank employee, this guy had access to everyone's personal data including signatures. He could have sent in written applications and accomplished the same dirty deeds. Instead of blaming the internet, they need to be placing their distrust in the bank where this guy worked.
I want to respond to both of the messages posted about Internet-based Identity Theft, which asked how often does ID theft happen, and is it a real-world problem or an Internet problem...
But first of all, identity theft is not the biggest roadblock for e-commerce. As Mike, the first poster said, how much does Internet theft of identity happen? Bigger problems for the growth of e-commerce include the low number of people with Net access at a reasonable speed and the slowdown overall of consumer spending.
Moreover, with reference to the second poster's comments, how much does ID theft happen on the Internet as opposed to someone getting your SSN and credit card numbers in the real world?
It seems to me that the real problem lies with the credit bureaus and lack processing procedures at credit card companies and merchants who will process nearly every transaction without verifying that the right person is requesting it.