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Credit reporting agencies and financial institutions commit fraud all the time. They call it identity theft so that you think it is your fault instead of their

Credit reporting agencies and financial institutions commit fraud all the time. They call it identity theft so that you think it is your fault instead of their fault. No one would care about a bank giving a loan to a person that was impersonating them except for the fact that the bank (credit card, mattress store, car dealership, etc) commits fraud and reports to the credit agency that you have defaulted on your loan when you have not. Then the credit reporting agency also commits fraud when they sell this false and damaging information to others. This is the big lie. That "identity theft" should be the problem of the person who was impersonated. Pass laws that heavily fine entities that give false information to credit bureaus and fine credit bureaus who give out false information. "Identity theft" would no longer be something that people would worry about.

lotsofpulp 6y ago
I agree that the consequences of identity theft should fall on the financial institutions and credit reporting agencies.
gruez 6y ago
>Credit reporting agencies and financial institutions commit fraud all the time. They call it identity theft so that you think it is your fault instead of their fault. No one would care about a bank giving a loan to a person that was impersonating them except for the fact that the bank (credit card, mattress store, car dealership, etc) commits fraud and reports to the credit agency that you have defaulted on your loan when you have not. That's literally what not fraud is. >In law, fraud is intentional deception to secure unfair or unlawful gain, or to deprive a victim of a legal right If some guy walks into a bank and claim they're you and they believe it, the banks aren't gaining anything. If anything, they lost money. Wrongly reporting the default to the CRAs also doesn't benefit them either; it's not like they compensate the banks based on how many default reports they send in. Finally, it's missing the "intentional" part. Lax security practices are negligence at best.
- bsanr2 6y ago
  >If some guy walks into a bank and claim they're you and they believe it, the banks aren't gaining anything. They would have just sold a loan. >If anything, they lost money. Can't they sell the defaulted loan to collections? >Lax security practices are negligence at best. Systemic, known, and long-standing negligence speaks to intention.
  - lotsofpulp 6y ago
    > Can't they sell the defaulted loan to collections? Why would anyone pay face value for a defaulted loan?
    - deleted 6y ago
      [deleted]
  - gruez 6y ago
    >They would have just sold a loan. Yeah, that's what their books say, but that doesn't necessarily match reality. In reality they gave $1000 in cash to someone, and their expected return on that is a fraction of that. Same logic if you bought paid $800 for bonds with face value of $1000, but unknown to you, the bonds are actually junk bonds with a expected value (factoring in repayment and default) of $500. In that case your paper gains are $200, but in reality you actually lost $300. >Can't they sell the defaulted loan to collections? They gave the bad guy a loan for $1000. They're out $1000. They sell the loan to collections for $300, they're still out $700. >Systemic, known, and long-standing negligence speaks to intention. Security exists on a spectrum, and there are trade-offs to be made. Clearly the banks don't have an interest in selling fraudulent loans, and putting up too much barriers when it comes to authentication also has costs.
    - bsanr2 6y ago
      Does... interest stop being a factor? They gave an x-year loan for $1000 at x% APR (was it subprime?). Also, penalties. Collections can go after you for the full amount. They buy it from the bank for the original $1000+. Or, the loan hasn't defaulted yet. The bank suspects it will. They load it into a bundle, get it highly-rated, sell the bundle. They make a profit. A whole bunch of other people get hosed. >Clearly the banks don't have an interest in selling fraudulent loans This is the wrong decade to be making that statement.
- njarboe 6y ago
  Maybe a better way of say this is that the bank is committing libel when they report to a credit bureau that you have defaulted on a loan when you have not. They say you did something that you did not do and the fact of them declaring that lie does you damage. The important thing is that "identity theft" should be a problem for the entity that made the loan to a criminal and not the person that was impersonated. Call it "bank libel" when someones credit score is ruined by a bank that gives a loan to the wrong person and one is closer to describing the truth of the situation. Edit: mindslight mentions in this thread that: "The 'Fair' Credit Reporting Act explicitly immunizes the surveillance bureaus against the tort of libel". Amazing.
mindslight 6y ago
That's not fraud. The tort you're looking for is libel. The "Fair" Credit Reporting Act explicitly immunizes the surveillance bureaus against the tort of libel. This is actually another instance of regulatory capture.
- njarboe 6y ago
  Yes, you are right. It's libel. Wow, I did not know that the surveillance bureaus are exempt from libel. What an incredible law against the interests of the people. That explains why I've never heard about class action suites against them. I'll have to read up on it. Thanks for the info.

lotsofpulp 6y ago

I agree that the consequences of identity theft should fall on the financial institutions and credit reporting agencies.

gruez 6y ago

>Credit reporting agencies and financial institutions commit fraud all the time. They call it identity theft so that you think it is your fault instead of their fault. No one would care about a bank giving a loan to a person that was impersonating them except for the fact that the bank (credit card, mattress store, car dealership, etc) commits fraud and reports to the credit agency that you have defaulted on your loan when you have not. That's literally what not fraud is. >In law, fraud is intentional deception to secure unfair or unlawful gain, or to deprive a victim of a legal right If some guy walks into a bank and claim they're you and they believe it, the banks aren't gaining anything. If anything, they lost money. Wrongly reporting the default to the CRAs also doesn't benefit them either; it's not like they compensate the banks based on how many default reports they send in. Finally, it's missing the "intentional" part. Lax security practices are negligence at best.

bsanr2 6y ago
>If some guy walks into a bank and claim they're you and they believe it, the banks aren't gaining anything. They would have just sold a loan. >If anything, they lost money. Can't they sell the defaulted loan to collections? >Lax security practices are negligence at best. Systemic, known, and long-standing negligence speaks to intention.
- lotsofpulp 6y ago
  > Can't they sell the defaulted loan to collections? Why would anyone pay face value for a defaulted loan?
  - deleted 6y ago
    [deleted]
- gruez 6y ago
  >They would have just sold a loan. Yeah, that's what their books say, but that doesn't necessarily match reality. In reality they gave $1000 in cash to someone, and their expected return on that is a fraction of that. Same logic if you bought paid $800 for bonds with face value of $1000, but unknown to you, the bonds are actually junk bonds with a expected value (factoring in repayment and default) of $500. In that case your paper gains are $200, but in reality you actually lost $300. >Can't they sell the defaulted loan to collections? They gave the bad guy a loan for $1000. They're out $1000. They sell the loan to collections for $300, they're still out $700. >Systemic, known, and long-standing negligence speaks to intention. Security exists on a spectrum, and there are trade-offs to be made. Clearly the banks don't have an interest in selling fraudulent loans, and putting up too much barriers when it comes to authentication also has costs.
  - bsanr2 6y ago
    Does... interest stop being a factor? They gave an x-year loan for $1000 at x% APR (was it subprime?). Also, penalties. Collections can go after you for the full amount. They buy it from the bank for the original $1000+. Or, the loan hasn't defaulted yet. The bank suspects it will. They load it into a bundle, get it highly-rated, sell the bundle. They make a profit. A whole bunch of other people get hosed. >Clearly the banks don't have an interest in selling fraudulent loans This is the wrong decade to be making that statement.
njarboe 6y ago
Maybe a better way of say this is that the bank is committing libel when they report to a credit bureau that you have defaulted on a loan when you have not. They say you did something that you did not do and the fact of them declaring that lie does you damage. The important thing is that "identity theft" should be a problem for the entity that made the loan to a criminal and not the person that was impersonated. Call it "bank libel" when someones credit score is ruined by a bank that gives a loan to the wrong person and one is closer to describing the truth of the situation. Edit: mindslight mentions in this thread that: "The 'Fair' Credit Reporting Act explicitly immunizes the surveillance bureaus against the tort of libel". Amazing.

mindslight 6y ago

That's not fraud. The tort you're looking for is libel. The "Fair" Credit Reporting Act explicitly immunizes the surveillance bureaus against the tort of libel. This is actually another instance of regulatory capture.

njarboe 6y ago
Yes, you are right. It's libel. Wow, I did not know that the surveillance bureaus are exempt from libel. What an incredible law against the interests of the people. That explains why I've never heard about class action suites against them. I'll have to read up on it. Thanks for the info.