Previous Politech message: "No broad U.S. privacy laws costs 'tens of billions,' study says" http://www.politechbot.com/p-03307.html -Declan --- From: "Bill Fason" <wfasonat_private> To: <declanat_private> Subject: Re: No broad U.S. privacy laws costs "tens of billions," study says Date: Thu, 28 Mar 2002 02:13:16 -0600 Declan, Gellman's report "Privacy, Consumers, and Costs" deserves careful scrutiny for its computation of "costs incurred by both business and individuals due to incomplete or insufficient privacy protections reach tens of billions of dollars every year." On the question of identity fraud, he claims that "it is also true that extensive and largely unregulated trafficking in personal information - typically without consumer knowledge or consent - makes it easier for identity thieves to operate." The term "trafficking in personal information" is used ten times in Gellman's report, and is employed deliberately as if companies such as ChoicePoint and Acxiom occupy the same moral plane as, say, Colombian drug cartels. (In the minds of privacy regulators, perhaps they do. In 2001 Privacy International picked out ChoicePoint for opprobrium with its Big Brother Award.) Identity fraud is an appalling problem, as is the woefully inadequate response by law enforcement and the financial services sector to it. What exactly is the connection between companies which legally sell personal information business-to-business and the commission of identity fraud? Here Gellman assumes too much. It is commonly estimated that there are perhaps half a million cases of identity fraud each year, the media have killed many forests on the subject of "internet-related crime," and yet how many documented cases of identity fraud have been traced back to data obtained from ChoicePoint, Autotrack, or Lexis-Nexis, just to name the three most popular and powerful "look-up" services? The answer is equal to the number of towns in Georgia named "Sherman" - zero. Perpetrators of identity fraud tend to obtain information through outright theft, dumpster diving (shred your receipts, folks), bribery, company insiders, and scam phone calls. Given the rather low-tech methods employed, it is hard to see how the runaway problem of identity fraud can be chalked up as a cost of incomplete or insufficient data-protection laws. Just this week saw the sentencing of Felicia V. McFarland, a Auto License Bureau clerk in New York, for her role in a scam that used 120 fake non-driver's ID cards to defraud merchants. How would stiffer privacy laws on the private sector prevent future DMV clerks from illicitly lining their pockets? By the way, McFarland was sentenced to only 2 1/3 to seven years in prison. The crime of identity fraud typically involves the commission of half a dozen other federal crimes such as bank fraud, wire fraud, mail fraud, theft of mail, misuse of a Social Security Number, and the like. For a criminal determined to commit identity fraud, the violation of an additional law against "trafficking in personal information" is of little consequence. One might just as well argue for laws doubling the fines for speeding in a getaway car away from a bank robbery, or argue backwards that bank robberies are a "cost" of a lack of such laws. The fact of the matter is that privacy regulators simply hate companies such as ChoicePoint - period. For them, it does not matter that ChoicePoint's online system has been used in zero cases of identity fraud, but has been used in countless cases to solves detect fraud. The perception of "internet-assisted identity theft" is ideologically serviceable in a broader campaign. Regards, Bill Fason and Associates Investigations & Judgment Enforcement 1302 Waugh Dr #272 Houston TX 77019 vox 713.529.4279 Toll-free 866.865.4705 fax 713.529.9864 wfasonat_private moderator of USprivacylaw at yahoogroups ------------------------------------------------------------------------- POLITECH -- Declan McCullagh's politics and technology mailing list You may redistribute this message freely if you include this notice. Declan McCullagh's photographs are at http://www.mccullagh.org/ To subscribe to Politech: http://www.politechbot.com/info/subscribe.html This message is archived at http://www.politechbot.com/ ------------------------------------------------------------------------- Politech dinner in SF on 4/16: http://www.politechbot.com/events/cfp2002/ -------------------------------------------------------------------------
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