ID Theft Update

ID THEFT UPDATE….Michael Hiltzik’s column today is ostensibly about his recent problems with AOL, but it’s really broader than that. Turns out that someone recently opened a fraudulent AOL account with his credit card and it took him hours to finally emerge from AOL’s call center hell and get a human being on the line:

When I instructed him to reverse the charges to my credit card, he offered to mail me an affidavit to fill out….Presently, my affidavit arrived. To say the least, it’s a massive intrusion on my privacy. It requires me to mail AOL copies of my credit card bill, along with a personal utility or insurance bill as proof of residence. (Question: If I don’t live at the address I gave them, how did I receive the form they mailed me?) It asks for the names of all authorized users of the credit card. And so on.

The whole affair is a great example of the ID theft problem that I wrote about last year. Too many companies simply don’t care about fraud and ID theft because they don’t have any incentive to care about it. After all, why should they bother wasting their own money tracking down ID thieves when they aren’t the ones suffering the pain? Instead, the victim is the one who has to spend time, money, and emotional energy trying to sort things out.

But what if it cost AOL a thousand bucks ? or $10,000 ? whenever they opened a fraudulent account? No arguments, no excuses, and no safe harbors because they really, really think they’ve taken every reasonable precaution to prevent fraud. Instead, treat it the way banks treat money: if they lose it, they have to make good on it no matter how good their security is.

And you know what? That’s why their security is so good. Hold AOL and other companies to the same standard and they’d discover a sudden eagerness to beef up their security too. Funny how that works.