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Comment by trothamel | Hacker News Reader

I've always found the Mitchell and Webb take on identity theft/bank robbery to be a very interesting take on who's responsible:

https://www.youtube.com/watch?v=CS9ptA3Ya9E

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Yes. We really let creditors hoodwink us when we let them invent the idea of "identity theft" instead of what it is: "You trusted some fraudster's claim they were who they said they were."

One puts the onus on the defrauded company to fix their house; the other puts it on a third-party with no involvement in the transaction to... Make it harder? For strangers to lie and tell other strangers they are the person with the "stolen identity?"

We could have drastically changed the landscape on this if the first time a company came after someone whose identity was stolen for money not paid the government had responded with not only a "no" but a fine for using the law to harass a stranger.

>We really let creditors hoodwink us when we let them invent the idea of "identity theft" instead of what it is: "You trusted some fraudster's claim they were who they said they were."

This pissed me off so much. Victim blaming and they get away with it.

It's not victim blaming. They (the creditors) are the victims and they expect you to make them whole.

They expect strangers unrelated to the actual fraudulent transaction to make them whole.

To be fair, from the creditor's perspective it is often unclear whether the transaction was really illegitimate. Fraud in which the consumer falsely claims they were the victim of identity theft is a real phenomenon, in the same way that there is real insurance fraud where consumers falsely claim to be victims of physical theft.

That is because creditor's have every incentive to make sure they only barely perform identity verification. It's not at all uncommon to find out about people who discover someone else took out a loan in their name, but is actually making payments on it. It happens when someone is wanted for criminal investigations, an illegal immigrant, or just has crap credit.

Crappy identity verification basically widens their customer base.

As someone who works in a consumer loan-related field, I know from experience that this is not correct. With very few exceptions, creditors do not have incentives to barely perform identity verification. Even if 90% of identity thieves paid back their loans, the losses on the remaining 10% would swamp any profits -- and of course far fewer than 90% of identity thieves pay back their loans. Industry losses due to incorrect identity verification are in the tens of billions annually. There are many vendors that financial institutions pay big bucks to in order to improve their ability to correctly perform identity verification. However, like everything else, there are tradeoffs involved, and it is rarely if ever optimal to try to push identity fraud to nil.

I guess I should have specified "loan originators". You're right, creditors don't have any incentive to do this. But that salesman at the used car dealership doesn't really have anything to lose.

Fair enough. I agree about that.

It’s a stroke of genius how the banks managed to make the victims of bad security practice at banks responsible for these problems.

It is absolutely insane.

If the bank lends me money and I lose it, they expect to be paid back.

But if I lend them money, and they lose it, this is...my fault?

Maybe I'm naive but I've never thought about it this way.

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