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ID Theft, Good for Business

by with No Comment ITPoliticsTechnologyUsers

On their web site, the FTC estimates that "as many as 9 million Americans have their identities stolen each year."  There are 300 million people in the US… you can do the math.  On average, they say, you will likely be impacted by identity crime several times during your life.

In the IT world, we’ve known this for a long time.  Everyone’s basic information, including your SSN is readily available, cheaply and in a full spectrum of legal and illegal ways.  We also know that the real failing isn’t the fact that the information is out there and available, it’s the fact that such information is easy to use that constitutes the danger.

So, you may wonder why credit card ID theft commercials are en vogue, reporting on how much consumers and companies lose to ID theft each year… yet you never hear about the credit, medical, insurance, or any other industry lobbying congress to change the situation…

Could it be that ID theft is good for business?

Of course it is, and it all revolves around one word, “liability”.

Simplifying the problem –
People get confused about ID theft because it’s not a simple act, but for the sake of clarity, I will break it down to the major parts, Privacy and Crime.

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Privacy is simple, you give company A your information, and suddenly company B, or criminal C has it.  Doesn’t matter how it happened, this is an invasion of your privacy.  The Crime portion comes when someone decides to use this information in a criminal manner.  This can be as simple as someone using your credit information to buy a TV, or when HP’s private investigators get your phone records to prove you were leaking info to the press.

So, which is worse, having your information out there, or having it be easily misused?  It’s a very simple answer.  People want your information BECAUSE it can be easily misused, in both criminal and non-criminal-but-should-be ways.  If there’s no profit in stealing your identity, or if the risks outweigh the benefits, then the privacy situation returns to the non-, or small issue it had been for hundreds of years.

Of Crime and Jengo –
ID Crime relies on one fundamental building block, absence of liability.  No one has to steal anything from you to get a credit agency to extend a line of credit in your name, nor is anyone liable by default, for the damages done… so it happens every day.  Making personal information more difficult to use – or to improve the “Authentication” of those conducting transactions of all kinds is the only thing that will bring the ID theft tower down, but without liability, no business will take on the messy task of pulling that block.

For example, it is entirely possible that a 10 year old kid in America already has a mortgage… it’s entirely plausible that his identity was stolen years ago, used for lines of credit ending in a home loan that the criminal has skipped out on.

Did the mortgage agency commit a crime?  No, they did all they were required to do.  They will likely take the loss and help the kid restore his credit.  He is after all, 10 years old, and it would be a tough court case to win… but they could try to make the case to a judge if they chose.  So imagine how much harder it is for a 30 year old who may have to spend his life savings just to prove that he didn’t spend his life savings. 

Nowhere to turn –
It’s perfectly legal for a crediting agency to issue a line of credit to anyone claiming to be you; they set their own authentication procedures.  It is also legal for the crediting agency to hold you responsible for a line of credit given to the wrong person.  Credit reporting agencies are also not required to validate or authenticate information provided to them by creditors.  There simply is no minimum requirement for authenticating transactions of any kind, so you really have no recourse, it’s just your word against theirs.

THAT is the pillar upon which ID Theft is built.

Your misfortune is a good way to turn a buck –
What’s more, credit and insurance agencies have found out that the fear of ID theft is a pretty good money maker… and makes a pretty entertaining commercial to boot.  Now all credit cards offer some kind of premium anti-fraud service you can pay for… or you can get anti-ID theft insurance for yourself or your business.

You may recognize that racket in mobster movies.  In the old days, you paid the mafia protection money… protection from whom?  The mafia.  Today, you pay money to protect your identity to the people who lobby to ensure your identity isn’t protected.

Seems an apt analogy.

The public is confused about the issue and hounding legislators for action.  Legislators on the other hand, have been given very clear message from business:  Fo’gettabboddit!

Self-Solving Riddles –
We do not have to regulate the means of authentication to make things right… all we have to do is hold companies liable for costs and damages associated with providing credit or conducting transactions (financial or informational) with the wrong individual.  Let the free market figure out how to deal with that. 

Any massively centralized Federal effort, like a National ID card would be fraught with loopholes and corruption.  Personally, I think that private industry can offer far more elegant, varied and secure solutions.  All I am saying is that right now, what’s good for business is also good for criminals, so much so that it’s difficult to distinguish the two.  Business needs a reason to join the fight, and the best way to do that is to make it cheaper to do the right thing.

j.ello on IT Part 1: The New Old Thing

by with No Comment computersITj.ello on ITTechnologyUsers

I have been in the so-called “IT” profession for more than half my life.  I am shocked to find how little has changed in that time… and how much everyone thinks it has.

I was pleased to find a lovingly-written article on the perennially reborn, long-beloved operating system called GEOS.  If you haven’t heard of it, it provided a Mac/Windows-like interface on a Commodore 64/128… in 1986.  Think about that for a moment.  There was a mouse and a friendly, visual operating system for a computer that couldn’t even hold a candle to an average cell phone.  In fact, the “Start Menu”, so synonymous with Windows, was a concept introduced years earlier in GEOS. A WYSIWYG word processor, a spreadsheet application, a database, and a whole lot more.  All the fundamentals of a full fledged office suite, and while no, GEOS wasn’t the first to do these things, GEOS did them all in 64k, 20 years ago.  That says something about us, about technology, and about the Information Technology industry.

Back to 2006, it seems we’ve come so far.  But after 20 some-odd years of windowed-interface development, what are the primary activities of a typical person at work in front of a computer?  Office applications. CPU speed, RAM, storage, all multiplied thousands of times over 20 years, and we do office applications.

“…why, oh why, do people still work at the same speed no matter how fast their computers are?”

And you’ll say, “but we do so much in addition to that”.  Do we?  I could send email in 1986.  We had the equivalent of your typical websites, and while they weren’t all interconnected or particularly pretty, they did have daily content, forums, some even had multi-user chat rooms.  We had downloads such as midi-like renditions of music (illegally created and distributed, just like today), software (freeware, shareware and pirated, just like today), and such teen favorites as porn and the “Anarchist Cookbook“.

Truth is that the desires of casual computing haven’t changed, neither has the amount of knowledge necessary to do the things we want to do.  Entertainment *STILL* almost single-handedly drives the economics of computing, with no end in sight.  All we’ve been doing for 20 years is applying new capabilities to make the old ideas more attractive, more intelligent, more “2.0”. 2.0… oh yes… I’ll come back to this “2.0” crap… just you wait.

So, if all we’re doing is the same old thing, why isn’t it any easier?  Why are our IT staffs inundated with seemingly basic questions… better yet, why do we still have IT?  Many technology analysts have been predicting for at least as long as I’ve been alive that all of this will simply become black-box and push-button, akin to electricity.  And yet here we are, with an ever diverging technology base, and an ever more complicated set of scenarios for the IT staff… and an ever developing understanding of how inadequate our infrastructure is to handle the “same old things” that we’ve always done.  Why do we insource, then outsource, then insource again?  And why, oh why, do people still work at the same speed no matter how fast their computers are?

These answers and more will be revealed over the next few days, including why all the experts preaching “computing is commodity” are wrong… and why I say “Computing is art.”