16 ms·

IMF researchers: digital footprint yields better credit assessment

110 points by da_big_ghey 6y ago

dredmorbius 6y ago
I'm trying and failing to come up with a concise expression of just how utterly evil and wrong this proposal is, and what the assumptions and presumptions it makes I think the first question needs to be "mu". Unask the question of how, or even whether, individuals' entire personal and informational histories should be deposited in the perpetual datastores of banks, credit lenders, collections agents, slumlords, and repo agents across the world. Why the heck are we basing all transactions on credit in the first place? Why aren't we paying people enough to live? Why aren't we ensuring that at a time when shutting the world down to the maximum extent possible for a relatively brief period of time is the best way to return to a full and normal state of commerce? Why don't we have mechanisms for distributing trust such that risks of transactions aren't extreme. E.g., do I really need to be able to transact a purchase by connecting to a website continents and oceans away, only to have my payor suddenly get paranoid, deny the deal, and call me back hours later to ask if I'd in fact attempted the purchase? Meantime neither I, the vendor, the payor, our various software, systems, and communications vendors, and others involved in the current state of transactions, trusts one another at all. Do advances in communications technology inherently degrade interpersonal social trust? I'm inclined to think they do: https://old.reddit.com/r/dredmorbius/comments/6jqakv/communications_advances_undermine_trust/ https://old.reddit.com/r/dredmorbius/comments/6jqakv/communi... Do people need accounts that can drain their life savings globally accessible to anyone (or any algorithm), any where, at any time? What would a system in which these are not implicitly assumed or quietly-accepted aspects look like? How do we simply engineer / design around the unstated problem at the heart of this proposal? Why evil? The dangers of data and surveillance have long been pointed out by key participants in the development of information technology itself. I've compiled a list of pre-1980 warnings from Paul Baran (co-inventor of packet-based switching) and Willis Ware, both of RAND, Shoshana Zuboff, of Harvard University, Arthur R. Miller, and Richard Boeth: https://toot.cat/@dredmorbius/105074933053020193 https://toot.cat/@dredmorbius/105074933053020193 Thanks heartily to da_big_ghey for submitting this and working around the inerhent evil banality of the IMF proposal by Arnoud Boot, Peter Hoffmann, Luc Laeven, Lev Ratnovski, signatories to the death of all privacy and the opening of universal surveillance in all commercial and financial dealings. Remember their names. I'd certainly missed it entirely.
- dredmorbius 6y ago
  On authors who were publishing information technology panopticon concerns in the 1980s, or earlier Paul Baran / RAND - "On the Engineer's Responsibility in Protecting Privacy" - "On the Future Computer Era: Modification of the American Character and the Role of the Engineer, or, A Little Caution in the Haste to Number" - "The Coming Computer Utility -- Laissez-Faire, Licensing, or Regulation?" - "Remarks on the Question of Privacy Raised by the Automation of Mental Health Records" - "Some Caveats on the Contribution of Technology to Law Enforcement" Largely written/published 1967--1969. https://www.rand.org/pubs/authors/b/baran_paul.html https://www.rand.org/pubs/authors/b/baran_paul.html Willis Ware / RAND Too numerous to list fully, 1960s --1990s. Highlights: - "Security and Privacy in Computer Systems" (1967) - "Computers in Society's Future" (1971) - "Records, Computers and the Rights of Citizens" (1973 - "Privacy and Security Issues in Information Systems" (1976) - "Information Systems, Security, and Privacy" (1983) - "The new faces of privacy" (1993) https://www.rand.org/pubs/authors/w/ware_willis_h.html https://www.rand.org/pubs/authors/w/ware_willis_h.html Misc Shoshana Zuboff, In the Age of the Smart Machine: The Future of Work and Power (1988) Notably reviewed in the Whole Earth Catalog's Signal: Communication Tools for the Information Age (1988). https://www.worldcat.org/title/in-the-age-of-the-smart-machine-the-future-of-work-and-power/oclc/60966402 https://www.worldcat.org/title/in-the-age-of-the-smart-machi... https://archive.org/details/inageofsmartmach00zubo/page/n7/mode/2up https://archive.org/details/inageofsmartmach00zubo/page/n7/m... "Danger to Civil Rights?", 80 Microcomputing (1982) https://archive.org/stream/80_Microcomputing_Issue_26_1982-02_1001001_US#page/n295/mode/2up https://archive.org/stream/80_Microcomputing_Issue_26_1982-0... (https://news.ycombinator.com/item?id=14329877 https://news.ycombinator.com/item?id=14329877) "Computer-Based National Information Systems: Technology and Public Policy", NTIS (September 1981) http://govinfo.library.unt.edu/ota/Ota_5/DATA/1981/8109.PDF http://govinfo.library.unt.edu/ota/Ota_5/DATA/1981/8109.PDF "23 to Study Computer ‘Threat’" (1970) https://www.nytimes.com/1970/03/12/archives/23-to-study-computer-threat.html https://www.nytimes.com/1970/03/12/archives/23-to-study-comp... The Stanford Encyclopedia of Philosophy "Privacy and Information Technology" bibliography is largely 1990--present, but contains some earlier references. https://plato.stanford.edu/entries/it-privacy/#Bib https://plato.stanford.edu/entries/it-privacy/#Bib Similarly "Privacy" https://plato.stanford.edu/entries/privacy/ https://plato.stanford.edu/entries/privacy/ Credit Reporting / Legislation US Privacy Act of 1974 https://www.justice.gov/opcl/privacy-act-1974 https://www.justice.gov/opcl/privacy-act-1974 Invasion of Privacy Act 1971 - Queensland Government, Australia https://www.legislation.qld.gov.au/view/pdf/inforce/current/act-1971-050 https://www.legislation.qld.gov.au/view/pdf/inforce/current/... Arthur R. Miller, The assault on privacy: computers, data banks, and dossiers https://archive.org/details/assaultonprivacy00mill/page/n7/mode/2up https://archive.org/details/assaultonprivacy00mill/page/n7/m... "The Computer, the Consumer and Privacy" (1984) https://www.nytimes.com/1984/03/04/weekinreview/the-computer-the-consumer-and-privacy.html https://www.nytimes.com/1984/03/04/weekinreview/the-computer... Richard Boeth / Newsweek The specific item I'd had in mind: Richard Boeth, "Is Privacy Dead", Newsweek, July 27, 1970 http://www.thedailybeast.com/articles/2013/06/11/is-privacy-dead.html%EF%BB%BF http://www.thedailybeast.com/articles/2013/06/11/is-privacy-... Direct PDF: https://assets.documentcloud.org/documents/712228/1970-newsweek-coverstory-privacy.pdf https://assets.documentcloud.org/documents/712228/1970-newsw... Based on an HN comment: https://news.ycombinator.com/item?id=2 https://news.ycombinator.com/item?id=2
usmannk 6y ago
[Edit: no longer relevant, see replies] No it doesn't? This is the only part of the post relevant to the headline: > The second and most complex problem is that certain kinds of people, like new entrepreneurs, innovators and many informal workers might not have enough hard data available. Even a well-paid expatriate moving to the United States can be caught in the conundrum of not getting a credit card for lack of credit record, and not having a credit record for lack of credit cards. > Fintech resolves the dilemma by tapping various nonfinancial data: the type of browser and hardware used to access the internet, the history of online searches and purchases. Recent research documents that, once powered by artificial intelligence and machine learning, these alternative data sources are often superior than traditional credit assessment methods, and can advance financial inclusion, by, for example, enabling more credit to informal workers and households and firms in rural areas.
- dredmorbius 6y ago
  Submission is clearly editorialised, but so too, lede is clearly buried. And exceedingly difficult to extract from content as written (HN offers guidelines on improving or clarifying titles, they just don't work here). Unfortunately, this also makes metadiscussion of the submission and title dominate the thread, at least until dang cleans up. I'm pinging dang.
- dang 6y ago
  Submitted title was "IMF says credit score should incorporate browsing history". That was egregious editorializing. Submitters: please don't do that! Cherry-picking the most sensational detail and making that the title is definitely not ok, and fabricating something the article doesn't say is right out! https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html When a title buries the lede in favor of bland corporate rhetoric, it's fine to replace it, but you should replace it with something accurate and neutral, using representative language from the article itself. I've taken a crack at that above. If anyone can suggest a better title by these criteria, we can change it again.
  - da_big_ghey 6y ago
naurupatel 6y ago
Truly a dystopian world we are entering. Now more than ever is the time for funding and developing alternative tools that utilize decentralization. What's coming cannot be stopped but it can be broken.
- bmitc 6y ago
  Nothing decentralized will ever remain so if humans are involved.
- vmception 6y ago
  Now how do I explain to my mom that her conspiracies do occur, the influential wealthy groups do exist and lobby governments, but that they have nothing to do with the independent data mining and data brokering companies which anyone can start right now
- JohnJamesRambo 6y ago
  It is already in motion, cryptocurrency will accept you no matter what your credit score or browsing history is. “The computer can be used as a tool to liberate and protect people, rather than to control them.” -Hal Finney
  - dredmorbius 6y ago
    How are you planning on allocating those bitcoin distributions? Do you have the context for the Finney quote? Apparently from a set of released emails: https://news.bitcoin.com/researcher-publishes-never-before-seen-emails-between-satoshi-nakamoto-and-hal-finney/ https://news.bitcoin.com/researcher-publishes-never-before-s... The larger context, from a 1992 Cypherpunks email: "Here we are faced with the problems of loss of privacy, creeping computerization, massive databases, more centralization - and [David] Chaum offers a completely different direction to go in, one which puts power into the hands of individuals rather than governments and corporations. The computer can be used as a tool to liberate and protect people, rather than to control them." https://web.archive.org/web/20140326104029/http://www.forbes.com/sites/andygreenberg/2014/03/25/satoshi-nakamotos-neighbor-the-bitcoin-ghostwriter-who-wasnt/#42e4aeba4a37 https://web.archive.org/web/20140326104029/http://www.forbes... Argument by unsupported assertion is ... relatively weak.
dredmorbius 6y ago
Editorialised title, despite a clearly buried lede. "What is Really New in Fintech" is original. "IMF says credit score should incorporate browsing history" was submitted. Buried lede: Fintech resolves the dilemma by tapping various nonfinancial data: the type of browser and hardware used to access the internet, the history of online searches and purchases. Recent research documents that, once powered by artificial intelligence and machine learning, these alternative data sources are often superior than traditional credit assessment methods, and can advance financial inclusion, by, for example, enabling more credit to informal workers and households and firms in rural areas.
tyingq 6y ago
Guess I'll work on a browser plugin that makes lots of responsible sounding financial queries.
- erik_seaberg 6y ago
  https://en.wikipedia.org/wiki/Goodhart%27s_law https://en.wikipedia.org/wiki/Goodhart%27s_law strikes again.
- formercoder 6y ago
  Cue arms race
katakuchi 6y ago
You don't say?
hn_throwaway_99 6y ago
I hope that regulatory agencies start cracking down on these "alternative sources" for credit-worthiness data. Researchers have shown how it's very easy to attribute things like political party, race, sexuality, etc., things that are often illegal to take into consideration when determining credit, to other things like where you live, TV shows you like, apps you have on your phone, etc. And strangely (or not) this blog post from the IMF barely touches on the huge privacy concerns with this stuff.
- thegrimmest 6y ago
  If these sources of data are actually more accurate predictors of creditworthiness, then shouln't we be applauding their use? If it so happens that tall people are less likely to repay loans, why is it wrong to charge tall people higher interest? Otherwise aren't we just socializing the cost imposed by artificially fuzzy criteria?
  - layoutIfNeeded 6y ago
    Let me illuminate the problem: s/tall/black/ (inb4 downvotes)
    - thegrimmest 6y ago
      I actually wasn't thinking that at all. I chose tall because there is actually a major disparity in income between tall and short people. This disparty seems to be the ultimate counter-argument to any misguided attempt at "levelling the playing field".
  - Retric 6y ago
    Credit worthiness is directly used on job applications etc, so it feeds back into people’s ability to pay back loans. As such accuracy isn’t an independent variable it’s part of a larger system. We don’t want to artificially make people with for example long fingers unable to pay back loans. As such you want to avoid feedback loops even at the cost of some accuracy.
  - 6y ago
slg 6y ago
I'm not a fan of the traditional credit reporting system. It is often a black box that makes it difficult to understand how the actual credit scoring algorithm works. Although one of the important aspects of the current system is that all the inputs are known. We don't know exactly to what degree each input matters, but we know the inputs. A new system needs to keep that aspect or else is going to cause pain for a lot of people who are financially punished without being aware of why. This type of transparency is also important for fairness. As other commenters have mentioned, some traits like race would be a good indicator of credit worthiness due to a variety of systemic socioeconomic issues. However that is generally considered unfair and is illegal to take that into consideration.
- lmohseni 6y ago
  Important to consider that credit scores weren’t a thing until 1989
  - sokoloff 6y ago
    That is the content of a meme circulating recently which is imprecise at the most charitable (and IMO pretty close to entirely wrong) Engineer Bill Fair and mathematician Earl Isaac (the “F” and “I” in FICO) started their company in 1956 and had a bank credit card scoring system available in 1970. Equifax was founded in 1899 (not a typo). The original name: “Retail Credit Company”. https://www.opploans.com/blog/a-brief-history-of-credit-scores/ https://www.opploans.com/blog/a-brief-history-of-credit-scor... https://www.myfico.com/consumer-division-of-FICO.aspx https://www.myfico.com/consumer-division-of-FICO.aspx
ilaksh 6y ago
If you want to reach out to unbanked people, one way to start would be to start prosecuting the predatory practice of reordering transactions and charging large overdraft fees rather than simply declining transactions. It should be illegal.
elil17 6y ago
Hacker News headlines of the future: Chrome extension which changes your user agent request header to get you a better mortgage Googling "Fun activities that don't cost money" increases your interest rates, study finds Samsung partners with Equifax to offer better car loans to users who upgrade to a new phone
condomhacker 6y ago
Credit companies should have no access to my digital presence. I expect no company to have access to my digital footprint whatsoever. Law enforcement for public safety? Sure. Financial services? Definitely no. Will it yield better credit assessments? sure. But it doesn’t benefit the general population. It is a one way proposal which only benefits the financial corporations. It is just like saying keeping slaves increases the productivity of an enterprise.
visarga 6y ago
> the type of browser and hardware used to access the internet, the history of online searches and purchases ... once powered by artificial intelligence and machine learning, these alternative data sources are often superior than traditional credit assessment methods, and can advance financial inclusion, by, for example, enabling more credit to informal workers and households and firms in rural areas Here is one of the most sensitive applications of ML. This one, like face recognition, can directly harm people. These guys only seem to think about the "superiority" of their method in minimizing lending risk. But the other party into this deal can also have something to lose. What's the difference between this and the Chinese social scoring system? They want to use private search logs. "Your privacy for a credit score?" Maybe the model is biased, how do we know? Is there an independent bias assessment process? Is there a way to sue for unfair rating? What are the values of the people working on the training set? Is there a "speak to human" step in the process where you can plead your case? I don't want an automated social discrimination machine.
- nerdponx 6y ago
  Well said. I would also add that computing such a score requires the same kind of intensive surveillance that many people here on HN (including me) are morally opposed to.
- zajio1am 6y ago
  > Maybe the model is biased, how do we know? There are multiple mutually incompatible metrics of fairness, being unbiased in one makes it biased in others. See e.g. https://www.chrisstucchio.com/pubs/slides/crunchconf_2018/slides.pdf https://www.chrisstucchio.com/pubs/slides/crunchconf_2018/sl...
- j16sdiz 6y ago
  Chinese social scoring system is much more extensive. It includes jaywalking and speaking evil of the government. It affects internet speed and boarding on trains. Sure the “western countries” are heading that direction, but still have a long way
- MikeUt 6y ago
  Having to trade away your privacy for access to financial services (where this is headed) is not OK just because the spying is unbiased. This is a common red herring, like the proliferating surveillance cameras and face recognition - somehow it is always implied the main reason we should worry is the racial bias, while everyone being followed 24/7 by a digital private investigator is a secondary concern.
Animats 6y ago
Would information about CEO behavior be useful to investors? That's worth considering. Browsing history? Phone call patterns? It's being worked on at the Harvard Business School.[1] "We measure the behavior of 1,114 CEOs in six countries parsing granular CEO diary data through an unsupervised machine learning algorithm. The algorithm uncovers two distinct behavioral types: “leaders” and “managers”. Leaders focus on multi-function, high-level meetings,while managers focus on one-to-one meetings with core functions. Firms with leader CEOs are on average more productive, and this difference arises only after the CEO is hired. The data is consistent with horizontal differentiation of CEO behavioral types, and firm-CEO matching frictions. We estimate that 17% of sample CEOs are mismatched, and that mismatches areas associated with significant productivity losses." [1] https://www.hbs.edu/ris/Publication%20Files/17-083_b62a7d71-a579-49b7-81bd-d9a1f6b46524.pdf https://www.hbs.edu/ris/Publication%20Files/17-083_b62a7d71-...
- alfiedotwtf 6y ago
  What will be measured, will be gamed
  - JorgeGT 6y ago
    Goodhart's law: when a measure becomes a target, it ceases to be a good measure
    - alfiedotwtf 6y ago
      Ha! Exactly
dredmorbius 6y ago
The blog is itself an advertisment for a longer (32 page) report released in August 2020, downloadable PDF available, largely an emerging trends report. "Financial Intermediation and Technology: What’s Old, What’s New?" https://www.imf.org/en/Publications/WP/Issues/2020/08/07/Financial-Intermediation-and-Technology-Whats-Old-Whats-New-49624 https://www.imf.org/en/Publications/WP/Issues/2020/08/07/Fin... The prospect of Fintech credit scoring from digital footprints is from "Onthe Rise of FinTechs – Credit Scoring using Digital Footprints", by Tobias Berg, Valentin Burg, Ana Gombović, Manju Puri, July 2018. 51pp. https://www.fdic.gov/analysis/cfr/2018/wp2018/cfr-wp2018-04.pdf https://www.fdic.gov/analysis/cfr/2018/wp2018/cfr-wp2018-04.... That was discussed at the time on HN (46 comments, June 22, 2018): https://news.ycombinator.com/item?id=17377967 https://news.ycombinator.com/item?id=17377967
alfiedotwtf 6y ago
Banks tracking your digital footprint made me vomit in my mouth a bit. Can we please not normalise surveillance culture
swiley 6y ago
Yikes. It won't be long before there's serious economic incentive to exclusively browsing the web by just running curl with TOR.
- Cederfjard 6y ago
  Unless it means you won’t get credit. Edit: Like how apparently not having any social media accounts can weigh against you, if asked to produce them, when attempting to enter certain countries.
  - swiley 6y ago
    Honestly credit is completely overrated. You can rent apartments for example even if you've never owned a credit card or taken out loans provided you have a job and can prove it. People just want to know you have the ability to pay them and behavior is a really stupid way to judge that.
    - Nowado 6y ago
      Create a better one and own the world.
    - sokoloff 6y ago
      Past behavior is not a guarantee of future behavior, but it’s a pretty good heuristic I think. If you’re contemplating lending money with no collateral to 2 people, one with a 10 year track record of other borrowing and consistently paying back loans as agreed and no information about their employment and a second person where all you know is they have a job, which one would you rather lend to? The lender wants to know that you will pay them not that you could afford to pay them.
esotericn 6y ago
People ask me why I use cash, why I use bitcoin, why I think Uber and Deliveroo and their ilk are poison - this is why. Take your data and shove it up your arse. If you work on this stuff, you're a cancer cell. You just haven't realised it yet. I don't need your "credit". I don't even need you. No-one does.
- EVa5I7bHFq9mnYK 6y ago
  How does Uber violate privacy? People are carrying their phones at all times, so THE BIG BROTHER knows where everyone is anyway.
  - dredmorbius 6y ago
    Not everyone carries a phone, not everyone activates it at all time. An one massive unconscionable data leak doesn't justify others. But since you ask, there was "God View": "'God View': Uber Allegedly Stalked Users For Party-Goers' Viewing Pleasure" (Kashmir Hill) https://www.forbes.com/sites/kashmirhill/2014/10/03/god-view-uber-allegedly-stalked-users-for-party-goers-viewing-pleasure/ https://www.forbes.com/sites/kashmirhill/2014/10/03/god-view...
    - EVa5I7bHFq9mnYK 6y ago
      Uber is a phone app ... so everyone who calls Uber does carry a phone.
      - dredmorbius 6y ago
        Well then, there's one of the problems. Again: not everyone carries a phone. "An one" in my earlier reply should have been "And one"
yabones 6y ago
This seems ridiculously simple to abuse. Set up a 'headless' chromium container with your social media cookies, set the user-agent to the very latest $5,000 Mac, and have it google stuff like "most exclusive golf clubs in xxx city" and "best winter tires to optimize insurance rates" Few days of that and you'll qualify for a mcmansion mortgage in the monoculture part of the suburbs where all the dentists live. Future is bright!
- Scoundreller 6y ago
  > set the user-agent I remember a uni network required me to install some anti-malware software. After changing my user agent, voilà, no requirement.
- dredmorbius 6y ago
  Online-behaviour-profile as a service!
- EVa5I7bHFq9mnYK 6y ago
  Not so future ... some 6 years ago I have been advised by a recruiter that to apply to a certain SV company, I must have a Facebook profile with a minimum of 100 friends. Two days of playing some stupid Flash game got me 400 friends and a position at a company.
hedora 6y ago
We should ban the credit reporting agencies. Lenders should simply consult court judgements regarding unpaid loans, and bank statements. People say having the courts settle legal disputes is too expensive. We’re paying multiple percentage points sales tax to credit card companies to establish a credit rating. Surely, that money would be better invested in a public, impartial court system.
theknocker 6y ago
And in a week, you’ll all forget that the global financial elite has openly admitted, again, to having the exact agenda "conspiracy theorists” have recognized for years, all because mr haha funny man on tv or Reddit said the word "cringe.”

110 points by da_big_ghey 6y ago

I'm trying and failing to come up with a concise expression of just how utterly evil and wrong this proposal is, and what the assumptions and presumptions it makes I think the first question needs to be "mu". Unask the question of how, or even whether, individuals' entire personal and informational histories should be deposited in the perpetual datastores of banks, credit lenders, collections agents, slumlords, and repo agents across the world. Why the heck are we basing all transactions on credit in the first place? Why aren't we paying people enough to live? Why aren't we ensuring that at a time when shutting the world down to the maximum extent possible for a relatively brief period of time is the best way to return to a full and normal state of commerce? Why don't we have mechanisms for distributing trust such that risks of transactions aren't extreme. E.g., do I really need to be able to transact a purchase by connecting to a website continents and oceans away, only to have my payor suddenly get paranoid, deny the deal, and call me back hours later to ask if I'd in fact attempted the purchase? Meantime neither I, the vendor, the payor, our various software, systems, and communications vendors, and others involved in the current state of transactions, trusts one another at all. Do advances in communications technology inherently degrade interpersonal social trust? I'm inclined to think they do: https://old.reddit.com/r/dredmorbius/comments/6jqakv/communications_advances_undermine_trust/ https://old.reddit.com/r/dredmorbius/comments/6jqakv/communi... Do people need accounts that can drain their life savings globally accessible to anyone (or any algorithm), any where, at any time? What would a system in which these are not implicitly assumed or quietly-accepted aspects look like? How do we simply engineer / design around the unstated problem at the heart of this proposal? Why evil? The dangers of data and surveillance have long been pointed out by key participants in the development of information technology itself. I've compiled a list of pre-1980 warnings from Paul Baran (co-inventor of packet-based switching) and Willis Ware, both of RAND, Shoshana Zuboff, of Harvard University, Arthur R. Miller, and Richard Boeth: https://toot.cat/@dredmorbius/105074933053020193 https://toot.cat/@dredmorbius/105074933053020193 Thanks heartily to da_big_ghey for submitting this and working around the inerhent evil banality of the IMF proposal by Arnoud Boot, Peter Hoffmann, Luc Laeven, Lev Ratnovski, signatories to the death of all privacy and the opening of universal surveillance in all commercial and financial dealings. Remember their names. I'd certainly missed it entirely.

dredmorbius 6y ago
On authors who were publishing information technology panopticon concerns in the 1980s, or earlier Paul Baran / RAND - "On the Engineer's Responsibility in Protecting Privacy" - "On the Future Computer Era: Modification of the American Character and the Role of the Engineer, or, A Little Caution in the Haste to Number" - "The Coming Computer Utility -- Laissez-Faire, Licensing, or Regulation?" - "Remarks on the Question of Privacy Raised by the Automation of Mental Health Records" - "Some Caveats on the Contribution of Technology to Law Enforcement" Largely written/published 1967--1969. https://www.rand.org/pubs/authors/b/baran_paul.html https://www.rand.org/pubs/authors/b/baran_paul.html Willis Ware / RAND Too numerous to list fully, 1960s --1990s. Highlights: - "Security and Privacy in Computer Systems" (1967) - "Computers in Society's Future" (1971) - "Records, Computers and the Rights of Citizens" (1973 - "Privacy and Security Issues in Information Systems" (1976) - "Information Systems, Security, and Privacy" (1983) - "The new faces of privacy" (1993) https://www.rand.org/pubs/authors/w/ware_willis_h.html https://www.rand.org/pubs/authors/w/ware_willis_h.html Misc Shoshana Zuboff, In the Age of the Smart Machine: The Future of Work and Power (1988) Notably reviewed in the Whole Earth Catalog's Signal: Communication Tools for the Information Age (1988). https://www.worldcat.org/title/in-the-age-of-the-smart-machine-the-future-of-work-and-power/oclc/60966402 https://www.worldcat.org/title/in-the-age-of-the-smart-machi... https://archive.org/details/inageofsmartmach00zubo/page/n7/mode/2up https://archive.org/details/inageofsmartmach00zubo/page/n7/m... "Danger to Civil Rights?", 80 Microcomputing (1982) https://archive.org/stream/80_Microcomputing_Issue_26_1982-02_1001001_US#page/n295/mode/2up https://archive.org/stream/80_Microcomputing_Issue_26_1982-0... (https://news.ycombinator.com/item?id=14329877 https://news.ycombinator.com/item?id=14329877) "Computer-Based National Information Systems: Technology and Public Policy", NTIS (September 1981) http://govinfo.library.unt.edu/ota/Ota_5/DATA/1981/8109.PDF http://govinfo.library.unt.edu/ota/Ota_5/DATA/1981/8109.PDF "23 to Study Computer ‘Threat’" (1970) https://www.nytimes.com/1970/03/12/archives/23-to-study-computer-threat.html https://www.nytimes.com/1970/03/12/archives/23-to-study-comp... The Stanford Encyclopedia of Philosophy "Privacy and Information Technology" bibliography is largely 1990--present, but contains some earlier references. https://plato.stanford.edu/entries/it-privacy/#Bib https://plato.stanford.edu/entries/it-privacy/#Bib Similarly "Privacy" https://plato.stanford.edu/entries/privacy/ https://plato.stanford.edu/entries/privacy/ Credit Reporting / Legislation US Privacy Act of 1974 https://www.justice.gov/opcl/privacy-act-1974 https://www.justice.gov/opcl/privacy-act-1974 Invasion of Privacy Act 1971 - Queensland Government, Australia https://www.legislation.qld.gov.au/view/pdf/inforce/current/act-1971-050 https://www.legislation.qld.gov.au/view/pdf/inforce/current/... Arthur R. Miller, The assault on privacy: computers, data banks, and dossiers https://archive.org/details/assaultonprivacy00mill/page/n7/mode/2up https://archive.org/details/assaultonprivacy00mill/page/n7/m... "The Computer, the Consumer and Privacy" (1984) https://www.nytimes.com/1984/03/04/weekinreview/the-computer-the-consumer-and-privacy.html https://www.nytimes.com/1984/03/04/weekinreview/the-computer... Richard Boeth / Newsweek The specific item I'd had in mind: Richard Boeth, "Is Privacy Dead", Newsweek, July 27, 1970 http://www.thedailybeast.com/articles/2013/06/11/is-privacy-dead.html%EF%BB%BF http://www.thedailybeast.com/articles/2013/06/11/is-privacy-... Direct PDF: https://assets.documentcloud.org/documents/712228/1970-newsweek-coverstory-privacy.pdf https://assets.documentcloud.org/documents/712228/1970-newsw... Based on an HN comment: https://news.ycombinator.com/item?id=2 https://news.ycombinator.com/item?id=2

usmannk 6y ago

[Edit: no longer relevant, see replies] No it doesn't? This is the only part of the post relevant to the headline: > The second and most complex problem is that certain kinds of people, like new entrepreneurs, innovators and many informal workers might not have enough hard data available. Even a well-paid expatriate moving to the United States can be caught in the conundrum of not getting a credit card for lack of credit record, and not having a credit record for lack of credit cards. > Fintech resolves the dilemma by tapping various nonfinancial data: the type of browser and hardware used to access the internet, the history of online searches and purchases. Recent research documents that, once powered by artificial intelligence and machine learning, these alternative data sources are often superior than traditional credit assessment methods, and can advance financial inclusion, by, for example, enabling more credit to informal workers and households and firms in rural areas.

dredmorbius 6y ago
Submission is clearly editorialised, but so too, lede is clearly buried. And exceedingly difficult to extract from content as written (HN offers guidelines on improving or clarifying titles, they just don't work here). Unfortunately, this also makes metadiscussion of the submission and title dominate the thread, at least until dang cleans up. I'm pinging dang.
dang 6y ago
Submitted title was "IMF says credit score should incorporate browsing history". That was egregious editorializing. Submitters: please don't do that! Cherry-picking the most sensational detail and making that the title is definitely not ok, and fabricating something the article doesn't say is right out! https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html When a title buries the lede in favor of bland corporate rhetoric, it's fine to replace it, but you should replace it with something accurate and neutral, using representative language from the article itself. I've taken a crack at that above. If anyone can suggest a better title by these criteria, we can change it again.
- da_big_ghey 6y ago

naurupatel 6y ago

Truly a dystopian world we are entering. Now more than ever is the time for funding and developing alternative tools that utilize decentralization. What's coming cannot be stopped but it can be broken.

bmitc 6y ago
Nothing decentralized will ever remain so if humans are involved.
vmception 6y ago
Now how do I explain to my mom that her conspiracies do occur, the influential wealthy groups do exist and lobby governments, but that they have nothing to do with the independent data mining and data brokering companies which anyone can start right now
JohnJamesRambo 6y ago
It is already in motion, cryptocurrency will accept you no matter what your credit score or browsing history is. “The computer can be used as a tool to liberate and protect people, rather than to control them.” -Hal Finney
- dredmorbius 6y ago
  How are you planning on allocating those bitcoin distributions? Do you have the context for the Finney quote? Apparently from a set of released emails: https://news.bitcoin.com/researcher-publishes-never-before-seen-emails-between-satoshi-nakamoto-and-hal-finney/ https://news.bitcoin.com/researcher-publishes-never-before-s... The larger context, from a 1992 Cypherpunks email: "Here we are faced with the problems of loss of privacy, creeping computerization, massive databases, more centralization - and [David] Chaum offers a completely different direction to go in, one which puts power into the hands of individuals rather than governments and corporations. The computer can be used as a tool to liberate and protect people, rather than to control them." https://web.archive.org/web/20140326104029/http://www.forbes.com/sites/andygreenberg/2014/03/25/satoshi-nakamotos-neighbor-the-bitcoin-ghostwriter-who-wasnt/#42e4aeba4a37 https://web.archive.org/web/20140326104029/http://www.forbes... Argument by unsupported assertion is ... relatively weak.

dredmorbius 6y ago

Editorialised title, despite a clearly buried lede. "What is Really New in Fintech" is original. "IMF says credit score should incorporate browsing history" was submitted. Buried lede: Fintech resolves the dilemma by tapping various nonfinancial data: the type of browser and hardware used to access the internet, the history of online searches and purchases. Recent research documents that, once powered by artificial intelligence and machine learning, these alternative data sources are often superior than traditional credit assessment methods, and can advance financial inclusion, by, for example, enabling more credit to informal workers and households and firms in rural areas.

tyingq 6y ago

Guess I'll work on a browser plugin that makes lots of responsible sounding financial queries.

erik_seaberg 6y ago
https://en.wikipedia.org/wiki/Goodhart%27s_law https://en.wikipedia.org/wiki/Goodhart%27s_law strikes again.
formercoder 6y ago
Cue arms race

katakuchi 6y ago

You don't say?

hn_throwaway_99 6y ago

I hope that regulatory agencies start cracking down on these "alternative sources" for credit-worthiness data. Researchers have shown how it's very easy to attribute things like political party, race, sexuality, etc., things that are often illegal to take into consideration when determining credit, to other things like where you live, TV shows you like, apps you have on your phone, etc. And strangely (or not) this blog post from the IMF barely touches on the huge privacy concerns with this stuff.

thegrimmest 6y ago
If these sources of data are actually more accurate predictors of creditworthiness, then shouln't we be applauding their use? If it so happens that tall people are less likely to repay loans, why is it wrong to charge tall people higher interest? Otherwise aren't we just socializing the cost imposed by artificially fuzzy criteria?
- layoutIfNeeded 6y ago
  Let me illuminate the problem: s/tall/black/ (inb4 downvotes)
  - thegrimmest 6y ago
    I actually wasn't thinking that at all. I chose tall because there is actually a major disparity in income between tall and short people. This disparty seems to be the ultimate counter-argument to any misguided attempt at "levelling the playing field".
- Retric 6y ago
  Credit worthiness is directly used on job applications etc, so it feeds back into people’s ability to pay back loans. As such accuracy isn’t an independent variable it’s part of a larger system. We don’t want to artificially make people with for example long fingers unable to pay back loans. As such you want to avoid feedback loops even at the cost of some accuracy.
- 6y ago

slg 6y ago

I'm not a fan of the traditional credit reporting system. It is often a black box that makes it difficult to understand how the actual credit scoring algorithm works. Although one of the important aspects of the current system is that all the inputs are known. We don't know exactly to what degree each input matters, but we know the inputs. A new system needs to keep that aspect or else is going to cause pain for a lot of people who are financially punished without being aware of why. This type of transparency is also important for fairness. As other commenters have mentioned, some traits like race would be a good indicator of credit worthiness due to a variety of systemic socioeconomic issues. However that is generally considered unfair and is illegal to take that into consideration.

lmohseni 6y ago
Important to consider that credit scores weren’t a thing until 1989
- sokoloff 6y ago
  That is the content of a meme circulating recently which is imprecise at the most charitable (and IMO pretty close to entirely wrong) Engineer Bill Fair and mathematician Earl Isaac (the “F” and “I” in FICO) started their company in 1956 and had a bank credit card scoring system available in 1970. Equifax was founded in 1899 (not a typo). The original name: “Retail Credit Company”. https://www.opploans.com/blog/a-brief-history-of-credit-scores/ https://www.opploans.com/blog/a-brief-history-of-credit-scor... https://www.myfico.com/consumer-division-of-FICO.aspx https://www.myfico.com/consumer-division-of-FICO.aspx

ilaksh 6y ago

If you want to reach out to unbanked people, one way to start would be to start prosecuting the predatory practice of reordering transactions and charging large overdraft fees rather than simply declining transactions. It should be illegal.

elil17 6y ago

Hacker News headlines of the future: Chrome extension which changes your user agent request header to get you a better mortgage Googling "Fun activities that don't cost money" increases your interest rates, study finds Samsung partners with Equifax to offer better car loans to users who upgrade to a new phone

condomhacker 6y ago

Credit companies should have no access to my digital presence. I expect no company to have access to my digital footprint whatsoever. Law enforcement for public safety? Sure. Financial services? Definitely no. Will it yield better credit assessments? sure. But it doesn’t benefit the general population. It is a one way proposal which only benefits the financial corporations. It is just like saying keeping slaves increases the productivity of an enterprise.

visarga 6y ago

> the type of browser and hardware used to access the internet, the history of online searches and purchases ... once powered by artificial intelligence and machine learning, these alternative data sources are often superior than traditional credit assessment methods, and can advance financial inclusion, by, for example, enabling more credit to informal workers and households and firms in rural areas Here is one of the most sensitive applications of ML. This one, like face recognition, can directly harm people. These guys only seem to think about the "superiority" of their method in minimizing lending risk. But the other party into this deal can also have something to lose. What's the difference between this and the Chinese social scoring system? They want to use private search logs. "Your privacy for a credit score?" Maybe the model is biased, how do we know? Is there an independent bias assessment process? Is there a way to sue for unfair rating? What are the values of the people working on the training set? Is there a "speak to human" step in the process where you can plead your case? I don't want an automated social discrimination machine.

nerdponx 6y ago
Well said. I would also add that computing such a score requires the same kind of intensive surveillance that many people here on HN (including me) are morally opposed to.
zajio1am 6y ago
> Maybe the model is biased, how do we know? There are multiple mutually incompatible metrics of fairness, being unbiased in one makes it biased in others. See e.g. https://www.chrisstucchio.com/pubs/slides/crunchconf_2018/slides.pdf https://www.chrisstucchio.com/pubs/slides/crunchconf_2018/sl...
j16sdiz 6y ago
Chinese social scoring system is much more extensive. It includes jaywalking and speaking evil of the government. It affects internet speed and boarding on trains. Sure the “western countries” are heading that direction, but still have a long way
MikeUt 6y ago
Having to trade away your privacy for access to financial services (where this is headed) is not OK just because the spying is unbiased. This is a common red herring, like the proliferating surveillance cameras and face recognition - somehow it is always implied the main reason we should worry is the racial bias, while everyone being followed 24/7 by a digital private investigator is a secondary concern.

Animats 6y ago

Would information about CEO behavior be useful to investors? That's worth considering. Browsing history? Phone call patterns? It's being worked on at the Harvard Business School.[1] "We measure the behavior of 1,114 CEOs in six countries parsing granular CEO diary data through an unsupervised machine learning algorithm. The algorithm uncovers two distinct behavioral types: “leaders” and “managers”. Leaders focus on multi-function, high-level meetings,while managers focus on one-to-one meetings with core functions. Firms with leader CEOs are on average more productive, and this difference arises only after the CEO is hired. The data is consistent with horizontal differentiation of CEO behavioral types, and firm-CEO matching frictions. We estimate that 17% of sample CEOs are mismatched, and that mismatches areas associated with significant productivity losses." [1] https://www.hbs.edu/ris/Publication%20Files/17-083_b62a7d71-a579-49b7-81bd-d9a1f6b46524.pdf https://www.hbs.edu/ris/Publication%20Files/17-083_b62a7d71-...

alfiedotwtf 6y ago
What will be measured, will be gamed
- JorgeGT 6y ago
  Goodhart's law: when a measure becomes a target, it ceases to be a good measure
  - alfiedotwtf 6y ago
    Ha! Exactly

dredmorbius 6y ago

The blog is itself an advertisment for a longer (32 page) report released in August 2020, downloadable PDF available, largely an emerging trends report. "Financial Intermediation and Technology: What’s Old, What’s New?" https://www.imf.org/en/Publications/WP/Issues/2020/08/07/Financial-Intermediation-and-Technology-Whats-Old-Whats-New-49624 https://www.imf.org/en/Publications/WP/Issues/2020/08/07/Fin... The prospect of Fintech credit scoring from digital footprints is from "Onthe Rise of FinTechs – Credit Scoring using Digital Footprints", by Tobias Berg, Valentin Burg, Ana Gombović, Manju Puri, July 2018. 51pp. https://www.fdic.gov/analysis/cfr/2018/wp2018/cfr-wp2018-04.pdf https://www.fdic.gov/analysis/cfr/2018/wp2018/cfr-wp2018-04.... That was discussed at the time on HN (46 comments, June 22, 2018): https://news.ycombinator.com/item?id=17377967 https://news.ycombinator.com/item?id=17377967

alfiedotwtf 6y ago

Banks tracking your digital footprint made me vomit in my mouth a bit. Can we please not normalise surveillance culture

swiley 6y ago

Yikes. It won't be long before there's serious economic incentive to exclusively browsing the web by just running curl with TOR.

Cederfjard 6y ago
Unless it means you won’t get credit. Edit: Like how apparently not having any social media accounts can weigh against you, if asked to produce them, when attempting to enter certain countries.
- swiley 6y ago
  Honestly credit is completely overrated. You can rent apartments for example even if you've never owned a credit card or taken out loans provided you have a job and can prove it. People just want to know you have the ability to pay them and behavior is a really stupid way to judge that.
  - Nowado 6y ago
    Create a better one and own the world.
  - sokoloff 6y ago
    Past behavior is not a guarantee of future behavior, but it’s a pretty good heuristic I think. If you’re contemplating lending money with no collateral to 2 people, one with a 10 year track record of other borrowing and consistently paying back loans as agreed and no information about their employment and a second person where all you know is they have a job, which one would you rather lend to? The lender wants to know that you will pay them not that you could afford to pay them.

esotericn 6y ago

People ask me why I use cash, why I use bitcoin, why I think Uber and Deliveroo and their ilk are poison - this is why. Take your data and shove it up your arse. If you work on this stuff, you're a cancer cell. You just haven't realised it yet. I don't need your "credit". I don't even need you. No-one does.

EVa5I7bHFq9mnYK 6y ago
How does Uber violate privacy? People are carrying their phones at all times, so THE BIG BROTHER knows where everyone is anyway.
- dredmorbius 6y ago
  Not everyone carries a phone, not everyone activates it at all time. An one massive unconscionable data leak doesn't justify others. But since you ask, there was "God View": "'God View': Uber Allegedly Stalked Users For Party-Goers' Viewing Pleasure" (Kashmir Hill) https://www.forbes.com/sites/kashmirhill/2014/10/03/god-view-uber-allegedly-stalked-users-for-party-goers-viewing-pleasure/ https://www.forbes.com/sites/kashmirhill/2014/10/03/god-view...
  - EVa5I7bHFq9mnYK 6y ago
    Uber is a phone app ... so everyone who calls Uber does carry a phone.
    - dredmorbius 6y ago
      Well then, there's one of the problems. Again: not everyone carries a phone. "An one" in my earlier reply should have been "And one"

yabones 6y ago

This seems ridiculously simple to abuse. Set up a 'headless' chromium container with your social media cookies, set the user-agent to the very latest $5,000 Mac, and have it google stuff like "most exclusive golf clubs in xxx city" and "best winter tires to optimize insurance rates" Few days of that and you'll qualify for a mcmansion mortgage in the monoculture part of the suburbs where all the dentists live. Future is bright!

Scoundreller 6y ago
> set the user-agent I remember a uni network required me to install some anti-malware software. After changing my user agent, voilà, no requirement.
dredmorbius 6y ago
Online-behaviour-profile as a service!
EVa5I7bHFq9mnYK 6y ago
Not so future ... some 6 years ago I have been advised by a recruiter that to apply to a certain SV company, I must have a Facebook profile with a minimum of 100 friends. Two days of playing some stupid Flash game got me 400 friends and a position at a company.

hedora 6y ago

We should ban the credit reporting agencies. Lenders should simply consult court judgements regarding unpaid loans, and bank statements. People say having the courts settle legal disputes is too expensive. We’re paying multiple percentage points sales tax to credit card companies to establish a credit rating. Surely, that money would be better invested in a public, impartial court system.

theknocker 6y ago

And in a week, you’ll all forget that the global financial elite has openly admitted, again, to having the exact agenda "conspiracy theorists” have recognized for years, all because mr haha funny man on tv or Reddit said the word "cringe.”