Make the credit-issuers like PayPal liable for identity-theft fraud
By Seth Richardson
In what’s becoming an annual ritual for me, I have to once again point out that identity theft is a problem for the victims only because of the lax security policies of credit issuers, the uncaring arrogance of credit reporting agencies, and dilatory state and federal legislatures who refuse to place the burden of identity fraud where it belongs: on the merchants who extend credit without carefully checking the actual identity of the person they are giving it to.
In the news today is the story of how five members of the Aurora City Council had their identities stolen, evidently from records improperly kept by the city itself. More than $2000 in fraudulent on-line purchases have been made in the past few weeks by thieves using a PayPal billing service called “Bill me Later.”
This “service” allows anyone, with a minimum amount of information, including only the last 4 digits of one’s Social Security number, to buy products and bill them to the victim. Experts in information securty have said that one does not even need the social security number because most Social Security numbers were, until very recently, issued consecutively by state and region, according to the date and time of birth. This means that with information about where a person was born, along with their birth date, it’s possible to infer the Social Security number and hit on it fairly easily. This makes quite literally everyone born before last year vulnerable.
This sort of cavalier treatment of innocent victims by merchants like PayPal is unconscionable and outrageous and we need laws to put a stop to it.
Is it the fault of the victims that the merchant sold goods to a fraudster? No, it’s the fault of those who issue credit to individuals or companies without properly ensuring that the person or firm they are issuing credit to is who they are supposed to be. In other words, most financially-motivated identity theft is perpetrated by thieves, but it’s aided and abetted by companies that issue credit that are either incompetent or simply do not care if they wrongfully issue credit to a credit thief because current law prevents consumers from suing them for failing to exercise responsibility.
And this disregard for proper business practice and security is abetted and exacerbated by the credit reporting agencies, who enter derogatory information onto a person or firm’s credit rating without first confirming that the debt claimed by the merchant is valid and is not the product of identity theft caused by lax security on the part of the merchant.
This is no small issue, and the effects of identity theft and lax security can be devastating both financially and emotionally. So much so that victims of lax security on the part of credit-issuers ought to have a cause of action to sue the credit-issuer for damages. But today, the law favors the merchants, credit card companies and banks, to the detriment of the consumer.
This disregard for the rights of individuals to not be impugned or maligned regarding their credit rating, which is a valuable and important part of one’s reputation is unacceptable and must be eliminated.
So who should bear the economic burden for issuing credit to an identity thief? The creditor of course. If they extend credit, they should be certain to whom they’re extending it, or they should suffer any losses resulting from their negligence.
The solution is pretty simple. We must pass laws that shift the burden of identity theft from the innocent victim to the abettors, who are the merchants, credit-issuers and the credit reporting agencies.
This is done by first prohibiting anyone from using a Social Security number for the purposes of identification for any reason other than for receiving Social Security benefits. That’s what the federal law authorizing the assignment of the number says anyway, and it’s time to enforce it upon creditors and credit reporting agencies.
Second, the law must require that creditors must provide, on demand by the alleged debtor, documentary proof that the person or firm to which the credit was issued is in fact the actual person or firm that requested the extension of the credit, and that the extension of credit was properly and legally authorized, in the case of a company.
Likewise, a credit reporting company must provide the same proof on demand that the debt claimed by the creditor was actually and validly incurred by the person the debt is claimed against before entering any derogatory information on that persons credit file.
This would require that creditors make absolutely certain that they have verified identification of the person requesting the credit, just as banks and the post office are required to verify a customer’s identification.
Further, the law should require that some representative of the business actually meet the customer face-to-face and personally verify that person’s identity using certified government-issued photo identification. The law would require both parties to sign a form attesting to the personal meeting and verification of identity and detailing the request for credit, and it would require that the verified photo identification of both parties, creditor and customer, be scanned and made a permanent part of the record. This makes the creditor liable and the agent who extended the credit identifiable and responsible.
The credit issuer would be required to retain this form permanently, and no claim by a creditor would be valid or could be reported to any credit reporting agency unless a certified copy of that form is produced on demand. It would become a mandatory part of any credit contract, without which no debt can be claimed or collection attempted.
This would help ensure that no credit is issued to persons using fictitious or false identity information, and that no false debts or reports to credit agencies can easily occur, as is the case today.
In the event of a dispute, the victim of an identity theft would only have to demand a copy of the form and demonstrate that he or she is not the person identified on the form, at which point all claims against the victim would be legally null and void, and the creditor would be left holding the bag.
Such a law would eliminate the vast majority of identity theft overnight, and it would place the risk for failing to properly verifying the identity of a borrower in the proper place; with the company that issues the credit.
Would this slow down and make more complex the process of issuing enforceable lines of credit? Yes, but that’s a good thing. Credit fraud is directly related to the ease with which someone can obtain it.
Merchants would still be allowed to assume the risk of not properly identifying a customer in the interests of expediency, but if the customer denies the debt, and the merchant cannot produce the legally-required form with a photograph of the purported debtor, the merchant would be legally prohibited from trying to collect the debt.
In short, it’s the responsibility of those who issue credit to be absolutely certain of the true identity of anyone they issue credit to, and they should bear the entire risk of lax identification policies.
It’s time to but the burden for preventing identity theft where it belongs, and take it off the shoulders of the innocent victims.
© 2011 Altnews
Judge upholds free speech in California
September 24th, 2011, 5:36 am by Seth RichardsonMuslim students who disrupted a lawful assembly convicted of infringing on Israeli Ambassador’s speech
By Seth Richardson
The United States has a long history of tolerating protest and exercises of free speech, especially by students, but of late, an honorable tradition has been debased by leftists, Progressives, union goons and various flavors of religious zealots who abuse their right of protest by exercising what amounts to a “heckler’s veto” over the equally protected free speech of people they don’t like.
We’ve all seen the videos of conservative speakers on college campuses being shouted down and pied in the face and otherwise heckled and prevented from exercising their right to speak freely at events to which they had been invited by other students and the violent protests of SEIU union goons who physically attack people who don’t agree with their radical leftist agenda.
But the tide may be turning for those who would deliberately disrupt such events. At Ambassador Michael Oren’s speech at the University of California, Irvine in February, 2010, 10 Muslim students were arrested and last week they were convicted by a jury of conspiring to disrupt the speech. They were sentenced to community service and three years of probation by Orange County Superior Court Judge Peter J. Wilson.
Good for the jury, and good for Judge Wilson.
The First Amendment protects free speech and protest, but it doesn’t protect it everywhere and at any time. Like all rights, the government may impose reasonable time, place and manner restrictions on free speech so long as the regulations are intended to keep the peace and are not used to discriminate based on the content of the protest.
If the Muslim students had marched outside the lecture hall with signs and even bullhorns, they would likely have not gotten arrested. But disrupting a lawful assembly of persons who came, and often have paid to hear a speaker, is an abuse of the right of free speech, and an infringement of the rights of the speakers and those who have come to hear them.
The hecklers in this case tried to argue that they had a right to stand and shout out prepared statements like “propagating murder is not an expression of free speech” and cheer so loudly for such statements that the Ambassador could not continue for long periods. They tried to defend their actions by producing pie charts showing how much time they spent disrupting the event versus how long the Ambassador spoke.
But however passionate people are about having their side of the debate heard, while the First Amendment protects their right to express themselves, it does not necessarily guarantee them “equal time” in a venue that someone else has paid for and reserved for the purpose of expressing their message.
The Muslim students would have been welcome to reserve the same hall, at another time, to present their views, and it would have been just as unlawful for Israeli protesters to disrupt their presentation.
Free speech for all requires a degree of civility and respect for the opinions of others, and tolerance for diversity of opinion, not, as the Neo-Marxists, religious radicals and Progressives would prefer, a platform reserved only for radical left-wing or religious propaganda and indoctrination that silences all other opinions.
Those who value our traditions of free speech and protest, in appropriate venues and at appropriate times, should thank this judge and jury for defending everyone’s right to express themselves in a peaceable and lawful manner.
© 2011 Altnews
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