Saturday, April 10, 2010, AM | 1 Comment
Experts report that cases of ID theft and fraud in 2009 – about 10 million Americans – are at par with 2003 level and that was the most of any year.
That means the problem of ID theft is still in full swing and we must take steps to try to prevent it.
If you search online for ID theft, many sites, including this blog, have shed light on this problem.
However, all the new fraud alert tools and increased awareness of the perils of identity theft have not been able to prevent it.
- ID theft experts and politicians blame the easy availability of personal data like Social Security numbers.
- Another problem seems to be that lenders are too willing to extend credit to just about anybody without checking ID rigorously.
A thesis has been presented by a University of California, Berkeley lecturer, Chris Jay Hoofnagle, in a new report: “Internalizing Identity Theft.”
Lenders need to train employees
There have been every kind of measures taken by the credit lenders to acquire new customers. In the report, the author mentions that’s one reason why of 16 applications presented by impostors to obtain credit or medical services, almost all were rife with errors that should have suggested fraud. Yet in all 16 cases, credit or services were granted anyway.
The author argues the rigorous and perverse incentives of lenders – to sign up as many new customers as possible – are the heart of the problem and must be central to the solution [that sounds like greed to me on the part of the lenders. I wonder if signing up new customers has commission-based incentives.]
In a Nutshell
Solutions to the ID theft problem have focused on increasing criminal penalties for individual impostors. These penalties should be extended to institutions as well who so carelessly extend credit without checking ID properly.
Another solution can be not only educating consumers but rigorous training of lenders employees. Along with strict criminal penalties, individuals and institutions ought to be extremely careful to not fall for ID theft.
What do you think?Facebook.com/doable.finance