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The optimal amount of fraud is non-zero (2022)

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Re: The optimal amount of fraud is non-zero (2022)

#111

Post by michaelt »

akerl_ wrote: post #63
wwalexander wrote: post #59

Earlier quoted context omitted.

The answer isn’t as clear as you think. https://www.aclu.org/documents/5-problems-national-id-cards

It seems pretty clear. That article is just an example of the craziness I was describing. Notably: having a unified ID structure has a ton of upsides, and "preventing terrorism" seems fully orthogonal. Additionally, we already have IDs that register humans into databases and are tracked when people travel, it's just that the databases are disjoint and thus even more error prone because they're run individually by sta…

Part of the problem here is America's shitty privacy laws.

You can get ID scanners for nightclubs which check dates, parse dozens of different designs of ID correctly, detect some types of fake IDs, and record banned patrons. That's a thing you can get in Europe as well as America.

But only in America are they allowed to save the patron's address and use it for marketing purposes.

Re: The optimal amount of fraud is non-zero (2022)

#112

Post by zimpenfish »

quickthrower2 wrote: post #95
Spunkie wrote: post #7

Anti-fraud departments have apparently not gotten the memo, and the whole situation has gotten obscene in the last few years. I regularly travel for work and it's impossible for me to make any purchases on major sites like Walmart, Best Buy, Target, Costco, etc. They all will accept an order, charge my card, and then randomly cancel the order some hours to days later, and refund me. Similarly when traveling internati…

Is this an American thing? I never get a card decline for any purchase on a credit card. Prepaid cards are another matter.

> Is this an American thing?

No. My (UK) bank will decline purchases if they look suspicious and send me an SMS with the information and ask me to yay/nay them. (For 4 years running, they did this for my early September purchase to Apple. Most annoying.)

Re: The optimal amount of fraud is non-zero (2022)

#113

Post by yipbub »

tptacek wrote: post #13
yreg wrote: post #10

I believe this is a trivial thing with a misleading title. Of course the optimal amount of fraud for a business is zero. A world with zero fraud would be optimal for them. And (also of course) given that combating fraud has costs, there is a level at which investing more money and effort into anti-fraud has diminishing returns. Therefore it is not worth it to go all in into the fight against fraud, but accept that so…

It's very unintuitive. It's come up on threads here several times, with people incredulous about the statement. It has ramifications for the kinds of discussions we have on HN, because the primary stimuli we get are news anecdotes, and anecdotes about fraud can be galling but still under some sane noise floor that organizations don't bother to stop.

I think it's just phrased unintuitively. "Balance usability against security hoops to jump through" sound better to me. You have to get to the last paragraph of the fifth section of this article before it makes anything resembling that statement. This could have been a paragraph or three.

Re: The optimal amount of fraud is non-zero (2022)

#114

Post by bigger_inside »

robertlagrant wrote: post #109
yardstick wrote: post #69

Earlier quoted context omitted.

> while the value of a statistical life in the US is >$10M Take the wealthiest top 10,000 Americans out of the equation, and what’s the value of a statistical life in the US? $10M seems to be a weird number in my mind. Edit: Well that was a fascinating rabbit hole: https://en.m.wikipedia.org/wiki/Value_of_life#:~:text=In%20W... .

> Take the wealthiest top 10,000 Americans out of the equation They are much less likely to be the recipient of all the money spent on entitlements, no? A giant bucket of money is spent on regular Americans.

what? no. Government money is a direct pipe to transnational corporations and the billionaires that run it. Welfare payments are peanuts compared to it.

Re: The optimal amount of fraud is non-zero (2022)

#115

Post by robertlagrant »

bigger_inside wrote: post #114
robertlagrant wrote: post #109

Earlier quoted context omitted.

> Take the wealthiest top 10,000 Americans out of the equation They are much less likely to be the recipient of all the money spent on entitlements, no? A giant bucket of money is spent on regular Americans.

what? no. Government money is a direct pipe to transnational corporations and the billionaires that run it. Welfare payments are peanuts compared to it.

You're confusing two things. If the government pays for healthcare, that is for people, but goes to organisations to implement what's being paid for.

Re: The optimal amount of fraud is non-zero (2022)

#116

Post by mjw_byrne »

Clickbaity, trying-too-hard title. The point being made is mundane: perfection is too expensive, so we settle for "good enough". This is near-universally applicable and near-universally understood.

The author is trying to make it sound deep and meaningful with statements like "you should welcome some fraud", as though fraud is actually required for the system to function (clever counterintuitive point made, cue huge dopamine spike). But no, we simply tolerate a certain amount of fraud because eliminating it isn't worth it. Yawn.

Re: The optimal amount of fraud is non-zero (2022)

#117

Post by bigger_inside »

robertlagrant wrote: post #115
bigger_inside wrote: post #114

Earlier quoted context omitted.

what? no. Government money is a direct pipe to transnational corporations and the billionaires that run it. Welfare payments are peanuts compared to it.

You're confusing two things. If the government pays for healthcare, that is for people, but goes to organisations to implement what's being paid for.

like trillion dollar bank bailouts, subsidies awarded through ruinous competition among jurisdictions, trillions and trillions of dollars of defense spending for which the government will invent endless wars.. like that?

Re: The optimal amount of fraud is non-zero (2022)

#118

Post by genezeta »

andyferris wrote: post #6
brazzy wrote: post #4

Earlier quoted context omitted.

Important corollary: it may well be possible to reduce fraud much closer to zero (then the currently accepted rate) without negative effects on legitimate business. For example, the USA's lack of a national ID (and the resulting adoption of realldy ba substitues like SSNs, driver's licenses and "two photo IDs") has made a plethora of fraud techniques ridiculously easy. In many other countries, "identity theft" so rar…

I lived in Spain and never understood how the DNI/NIE's weren't an easy vector for identity theft. You need to give the number to do the simplest things, and many people wanted to see the card (and possibly make a copy). As far as I know the smart chip on my card wasn't used once in 2.5 years. I suspect the digital certificates you could get from the government likely aren't as well protected by the general (non-tech…

Things may have changed since you were here. Currently, there's additional digital systems built around the e-DNI and much of the administration -national and local- uses that for most of the things where you previously just used your DNI number and a smile.

The certificates themselves in the DNI are used only occasionally, but it's mostly your decision: you can stick to using the certificates and not activate other means and then you can't access a bunch of things unless you use the certificates.

But still, this is mostly for the public administrations. Private entities, such as banks or whatever, don't really make use of it and build their own systems (most of the time quite stupid ones [0]).

--

[0] Fortunately they changed it, but for about a year or so my bank decided that instead of sending a 4-digit code through SMS -which you then typed to verify whatever transaction you were doing- it was "more secure" to just show 5, 10, or 20 4-digit codes on the transaction site and then send you a single number through SMS, say "7", to select the code from the list.

And somehow this was applauded and got them some newspaper headlines as the bank investing the most in advanced security in the country or some shit like that.

Re: The optimal amount of fraud is non-zero (2022)

#119

Post by cm2187 »

mjw_byrne wrote: post #116

Clickbaity, trying-too-hard title. The point being made is mundane: perfection is too expensive, so we settle for "good enough". This is near-universally applicable and near-universally understood. The author is trying to make it sound deep and meaningful with statements like "you should welcome some fraud", as though fraud is actually required for the system to function (clever counterintuitive point made, cue huge…

Agree. Particularly the tax writeoff argument is complete bullshit.

You could make an argument that you need some level of fraud to keep the anti-fraud dept on its toes. It’s like war. If you have an army that has never fought a war in a century, you should have no confidence you have an army at all. That’s a problem the day a real war or in this case a real fraud, happens.

Re: The optimal amount of fraud is non-zero (2022)

#120

Post by Nextgrid »

Tuna-Fish wrote: post #102
Spunkie wrote: post #7

Anti-fraud departments have apparently not gotten the memo, and the whole situation has gotten obscene in the last few years. I regularly travel for work and it's impossible for me to make any purchases on major sites like Walmart, Best Buy, Target, Costco, etc. They all will accept an order, charge my card, and then randomly cancel the order some hours to days later, and refund me. Similarly when traveling internati…

> I regularly travel for work and it's impossible for me to make any purchases on major sites like Walmart, Best Buy, Target, Costco, etc. They all will accept an order, charge my card, and then randomly cancel the order some hours to days later, and refund me. These sites are not cancelling your orders. The card-issuing bank is. If you have persistent trouble, switch banks.

Disagreed, the banks aren't cancelling it - they wouldn't authorize the transaction in the first place. Chances are, the banks are correctly returning an address verification mismatch if you didn't use your true billing address.

Most likely the stores are cancelling the orders because of billing/delivery address mismatch or (if you didn't set a different billing address) that it doesn't verify against your card.

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