Risks of identity theft: Can the market protect the payment system?
Identity theft has been a feature of financial markets for as long as alternatives have existed to cash transactions. But identity theft has recently occurred on a much larger scale. Data breaches often involve the apparent loss or acknowledged theft of the personal identifying information of thousands--or millions--of people. ; Identity theft poses risks, not only to individuals, but to the integrity and efficiency of the payment system--the policies, procedures, and technology that transfer information for authenticating and settling payments among participants. Identity theft can cause a loss of confidence in the security of certain payment methods and an unwillingness to use them. Markets can cease operating or switch to less efficient payment methods. Either represents a loss of efficiency for the economy. ; Schreft looks at the nature of identity theft today and the factors underlying its mounting risks. She also explores whether markets are able to limit the risks identity theft poses to the payment system.
Volume (Year): (2007)
Issue (Month): Q IV ()
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- Charles M. Kahn & William Roberds, 2005.
"Credit and identity theft,"
Conference Series ; [Proceedings],
Federal Reserve Bank of Boston.
- Julia S. Cheney, 2005. "Identity theft: do definitions still matter?," Payment Cards Center Discussion Paper 05-10, Federal Reserve Bank of Philadelphia.
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- George A. Akerlof, 1970. "The Market for "Lemons": Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, Oxford University Press, vol. 84(3), pages 488-500.
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