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You shouldn't become a victim when a bank opens a fraudulent account. The law shouldn't be that someone else has to pay the costs, the law should be that you t
by maxerickson 5y ago
You shouldn't become a victim when a bank opens a fraudulent account.
The law shouldn't be that someone else has to pay the costs, the law should be that you tell them to prove it was you that acted to open an account and they go pound sand if they can't do that.
- jjeaff 5y agoI agree. Surely there are cases where people have sued the bank or whatever provider for opening an account in their name. It seems like I should just be able to send them a certified letter that says no, i didn't open that account, please close and correct your credit reporting unless you have proof otherwise. If you don't comply I'll see you in my nearest small claim court. Seems like it would be an open and shut case.
- acdha 5y agoYes - “identity theft” in common usage has been a phenomenally successful effort by financial companies to shift the cost of their negligence to the consumer.
- infogulch 5y agoYes even the name itself implies the burden should be bourne by the individual. It's a fantastically successful disinformation campaign. We should refuse to call it "identity theft" and call it "identity fraud" instead.
- NortySpock 5y agoI just go all the way to "bank fraud" to make it obvious who should be doing more due diligence.
- IgorPartola 5y agoThis is the correct terminology. If someone opens an account with a bank using false credentials that’s just fraud. And the victim here is the bank, not the individual.
- otterley 5y agoIf undetected by the bank, the individual becomes the victim when their financial reputation is sullied by false reports of failure to repay debts.
- infogulch 5y agoSend like a clear cut case of bank libel to me: > Libel is a method of defamation expressed by print, writing ... that is injurious to a person's reputation, ... or injures a person in his/her business or profession. Might even be able to get punitive damages. https://www.law.cornell.edu/wex/libel https://www.law.cornell.edu/wex/libel Note, the person who "had their identity stolen" (that phrasing is an absurdity, twisted language designed to obscure and defraud the truth) was never a party to the deal. The only parties relevant here are the bank and the person that defrauded the bank. The only victim is the bank. Nobody here is arguing that this problem doesn't exist for real people, we're saying that it's insane that it even exists at all.
- u801e 5y agoUnfortunately, there's a law [1] that protects creditors and credit bureaus from that unless they act out of malice. [1] https://www.law.cornell.edu/uscode/text/15/1681h https://www.law.cornell.edu/uscode/text/15/1681h (e)
- infogulch 5y agoThat's interesting. > (e) Limitation of liability > ... no consumer may bring any action or proceeding in the nature of defamation, ... or negligence with respect to the reporting of information against any ... person who furnishes information to a consumer reporting agency ... except as to false information furnished with malice or willful intent to injure such consumer.
- meowster 5y agoIsn't posting bad information a "willful intent to injure"? I can't imagine the banks are piblishing bad info in order to help the consumer.
- dec0dedab0de 5y agoI prefer bank libel, because the bank is publishing false negative information about someone.
- pc86 5y agoOpening an account or the existence of one isn't "negative information."
- dec0dedab0de 5y agoOpening an account or the existence of one isn't "negative information." Sure, but I meant if they're reporting you to a credit agency for owing money or whatever. That is them publishing false information about you that will have negative consequences for you.
- luckylion 5y agoIt's false information though, if the person hasn't opened an account. It might or might not be negative based on what the recipient of that information deduces, but it's definitely false.
- acdha 5y agoThe problem would be intent: my understanding is that in the U.S. at least you would have to show that they knew it was false when they published it or refused to correct it. If they simply say “technical error, we fixed it” I think your odds of reaching that bar would be quite daunting.
- lumost 5y agoMy (limited) understanding is that this is the financial companies problem in every case except for when your payment information is stolen. In which case it becomes a hot potato of whoever is out the money is the one who is liable.
- loceng 5y agoAny ideas on what may be a better/more appropriate term than identity theft?
- acdha 5y agoI second “bank fraud”: https://news.ycombinator.com/item?id=28193639 https://news.ycombinator.com/item?id=28193639 If a bank extends credit to someone without doing their due diligence, they’ve definitely been defrauded but that’s between them and the crook, not the person the crook was claiming to be.
- wil421 5y agoMy identity was stolen after the equifax breach. The only cost to me was the gas it took to drive to the police station. Verizon and AT&T had automated systems where I input some information and the key part was having a police report number from the local PD. Once I had the police report everything was removed including the credit reporting. I had to call enterprise rent a car to get some stuff cleared but they even removed an overdue parking ticket from Santa Clara (never been to California). Nordstrom was the only proactive party they called me immediately when they noticed someone filing out a credit card application in another state.
- User23 5y agoThat is the law. But your legal rights are worthless if you can't afford a lawyer, and only in very specific circumstances does the law say the losing party has to pay the winner's fees. Unfortunately, the US government doesn't take identity theft seriously from a criminal prosecution perspective. At least not when it's affecting regular Americans.
- travoc 5y agoOn the bright side, identity theft insurance is very inexpensive because costly claims are rare. Most homeowners insurance policies include identity theft coverage.
- edoceo 5y agoI have to buy insurance in case the financial institution responsible for detecting the fraud fails and blame me?
- CrazyCatDog 5y agoAbsolutely—AFLAK for identity insurance. The free attach plans are pretty thin, most retail contracts will include their man hours to waste away with the credit card companies and fair Isaac / credit bureaus — but it’s obviously more $ than “free with purchase”
- supertrope 5y agoA de facto protection racket.
- otterley 5y agoThere are lots of reasons for insurance. One kind of insurance (liability) is to protect you in case you screw up. Other kinds of insurance (e.g., uninsured motorist, fire, etc.) are to protect you in case other people screw up.
- skeeter2020 5y agoTHe cost of identity theft is only partially monetary. A huge component is the ongling (sometimes lifetime) fight to reclaim your person, reputation and wel... identity. My homeowner policy may cover the cost of a fraudulently issued credit card, but no one at my insurance company will spend days, weeks and years trying to straighten out my credit issues and chasing down the many knock-on effects the fraud is going to cause.
- Wowfunhappy 5y ago...at first blush, I like this line of thinking, but I wonder what the side effects would be. If banks make it much harder to open accounts, that might hurt poorer folks the most, and perpetuate inequality.
- andy-x 5y agoThis is very odd argument, in the name "equality" anyone should be able to open account in your name?
- macintux 5y agoNot the person you’re replying to, but every well-intentioned regulation has a negative impact on someone. It’s always worth asking who, and whether there’s some way to mitigate the impact on people who are already struggling to make ends meet. Being poor is incredibly expensive and exhausting.
- kmonsen 5y agoIt seems a bit weird to try to fight inequality by reducing regulations on banks and make it easier for them to blame consumers for the banks mistakes. That argument would only make sense in the U.S.
- Wowfunhappy 5y agoI consider myself a liberal, I'm broadly in favor of more regulation, and I might even be in favor of this regulation given something to assuage my initial concerns (because as I said, I like the idea). But I believe there are also lots of well-intentioned but bad regulations, and so they need to be considered carefully!
- maxerickson 5y agoIs making it 'hard' to open an account the only way to prevent fraudulent accounts from being opened? I don't think I accept that premise. My argument is that the party that can actually do something about the fraud is the one that should feel the pain of dealing with it.
- vmception 5y agoThat's an interesting point, nobody here would actually know if someone has opened a bank account in their name! Going even further, nobody would actually complain if someone hijacked their identity and improved their credit score with good behavior! This is probably much more common than people being framed or having issues proving their identity.
- ajsnigrutin 5y agoYou can open an account without actually going to a bank in person with your ID card? Where the hell can you do that?
- discordance 5y agoNot sure about the US, but in Australia you can register a new bank account in a few mins online. Up, :86400, Hay… etc
- meowster 5y agoIn the U.S., I've opened all of my checking accounts and credit card accounts online. The only thing I've ever had to do in person was sign for a home mortgage.
- adrr 5y agoOnline banks let you do it.
- JCharante 5y agoCharles Schwab (Bank) is great and entirely online
- pjc50 5y agoUS doesn't have ID cards. Although people are trying to mandate them for voting.
- mikecoles 5y agoThe US has passports. The states do. They're called a driver's license. IDs are also issued to those that don't drive. It's a great idea to have for financial security. It's an even better idea to require them for election security.
- ajsnigrutin 5y agoSo... how do you identify yourself? I mean.. what's stopping me from saying I'm Jeff Bezos and that I'd like to withdraw a million or two?
- adrr 5y agoBank has to prove its you if there are debts. Just knowing your personal info isn’t enough. End of the day bank is eating the loss. The challenger banks lose millions in fraud per year with fake accounts.
- u801e 5y ago> You shouldn't become a victim when a bank opens a fraudulent account Imagine a world where banks have to pay you for identity theft protection so that you're more "diligent" about not going to phishing websites.
- zenexer 5y agoAlternative: Banks are incentivized to better authenticate people, rather than relying on faulty KBA and public IDs like SSNs—information that is often leaked and can be phished. That being said, none of the compromises described in the comment chain thus far required action on the part of the consumer; they all involved compromises of third-party companies. Like T-Mobile.
- pkulak 5y agoYou guys are both right.
- njarboe 5y agoThe Fair Credit Reporting Act of 1970 was/is promoted as a great milestone in helping people to get protection from secret databases that companies were creating on the whole populous. That part was true and it did prevent this problem that was arising of mass secret corporate dossiers on everyone (but secret government dossiers on everyone, of course still fine). On the other-hand, it gave the credit bureaus legal protection in creating these databases and people could only recover actual or statutory damages, attorney's fee, court costs and punitive damages if the violation was willful.[1] Since all those false reports ("identity thefts") are never willful on the part of banks and other lenders, there is almost no penalties that can be brought. The consumer bringing the most reasonable charge of libel against a credit bureau is specifically prohibited by this law, if the credit bureaus follow all of the rules (allowing people to see their reports, removing false info (good luck with that), etc.). If not a case of regulatory capture at the time, then at least this law needs to be updated given how important credit reports have become, how easy fraudsters can get your report tarnished, and how hard it is to get your reports corrected. [1] https://en.wikipedia.org/wiki/Fair_Credit_Reporting_Act https://en.wikipedia.org/wiki/Fair_Credit_Reporting_Act