From: Pierre Uszynski <pierre@shell.portal.com>
Date: Thu, 17 Aug 95 18:21:30 PDT
To: cypherpunks@toad.com
Subject: Re: SSL challenge -- broken !
Message-ID: <199508180058.RAA02949@jobe.shell.portal.com>
MIME-Version: 1.0
Content-Type: text/plain



Says Joe Buck:

> > >Should some bad person get hold of your card number and misuse
> > >it, you're not out any money: 
> > 
> > I'm not so sure....Checked the fees/interest lately?
> > "There ain't no such thing as a free credit card theft."
>
> Yes, it's true that this contributes to high interest rates (though
> defaults cost more than fraud).

Certainly not only that. In fact you pay directly for weak credit card
security through taxes used to legislate, police, try, and jail
fraudsters. Add to that the cost to society of keeping these people in
jail instead of more productive occupations. Add the time wasted
straightening out bogus transactions. Add the cost of delaying
purchases and action because of the (maybe irrational) fear that no
secure payment system is available.

The argument that fraud existed before credit cards is only a
technically correct statement. It does not bear. The point is, credit
card transactions could be much more secure, at sometimes trivial cost,
making much fraud disappear. Unfortunately, in this case, insecure
credit cards are not an obstacle to banks making money, so why should
they care?  Credit card fraud does not prevent politicians from being
re-elected, so why should they care?  Same would apply to car
manufacturers: easily stolen cars do not prevent them from making
money, so why should they care?

When 'bad persons' misuse credit cards, the cost to us is very real,
just well hidden by all involved.

Pierre.
pierre@shell.portal.com