Largest Computer ID Theft Ring Busted

Technocrat

Largest Computer ID Theft Ring Busted

zogger

Thu Aug 07 01:16:00 -0700 2008

Security

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Authorities have indicted a multinational computer gang for what is believed to be the largest ID theft effort ever. They compromised a lot of different retail chain stores and retrieved account information and credit card numbers and so on to be used for fraud purposes.

Mukasey said the total amount of the alleged theft was "impossible to quantify at this point". He said officials still had not identified all the victims who had had credit or debit card numbers stolen. ed.z.: Just goes to show your personal computer can be pretty secure and locked down and all that, but it doesn't matter once you start interacting with other entities and give them your data. It's no longer your data then and you have no way to verify their security, nor do they real have any good solution to undo data compromises. The entire design of this Credit Card and personal identification system is just dismal, IMO. It was sold as convenience and "safer than carrying cash", well nuts to that. It is barely more convenient and it is no safer at all, you can get robbed and re-robbed over and over again and inconvenienced for days/weeks/months etc trying to clear up an ID compromise. and I have yet to hear of any indemnification for your time and hassle and aggravation to clear up some merchant's compromise of your data.

Externalizing costs

wowbagger

Thu Aug 07 07:00:05 -0700 2008
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Like much of what is wrong with our society, the issue here is one of externalizing costs - specifically the cost of fraud. While the credit card industry makes much of how much "fraud costs us", in truth it costs the credit card companies very little. The merchants from whom the fraudulent purchases were made are the ones who pay the costs, as the credit card companies charge back to them any such purchases.

You want to solve the problem? Make the credit card companies liable for fraud - don't let them charge back to a merchant who was in compliance with their procedures for checking for invalid cards. Yes, the credit card companies will increase fees and interest rates to pass the costs back to the customer, but since that would then cause customers to reduce their use of credit cards, the credit card companies would ALSO be motivated to reduce the rate of fraud, in order to be able to charge less than their competitors and still make money.