E-tail big hitters club together to beat ID theft

Some of the biggest names in ecommerce, including Amazon.com, eBay and Microsoft, have formed a coalition to curb online identity theft.

The Coalition on Online Identity Theft said it plans to launch a public education campaign and encourage its members to work more closely with law enforcement officials in an effort to fight a crime that has emerged as a major concern among politicians and consumers in recent years.

The group is being organised by the Information Technology Association of America, a trade group representing the high-tech industry.

Greg Garcia, vice president of information security at ITAA said: "We all agree we want to do something about this and nip this in the bud."

Though some may argue that bud has long been in bloom already.

Statistics show that identity theft in the US alone is already hitting worrying levels. The number of consumers who complained about some sort of identity theft nearly doubled to 162,000 last year, according to the Federal Trade Commission. And government figures only scratch the surface, technology analyst firm Garter said. Gartner estimates that 3.4 per cent of US consumers - about seven million adults - have been victims of identity theft of some form in the past year.

"A lot of this is about public education and awareness," Garcia, said. "People can protect themselves."

Yet some believe consumer education can only go so far, and that legislation may be necessary. Gartner says, for instance, that banks and credit card companies are mishandling the problem by treating fraud as a cost of doing business rather than as a crime against their customers.

Gartner analyst Avivah Litan said in a report in July: "There is a serious disconnect between the magnitude of identity theft that innocent consumers experience and the industry's proper recognition of the crime. Without external pressure from legislators and industry associations, financial services providers may not have sufficient incentive to stem the flow of identity theft crimes."

Credit-card fraud accounted for 42 per cent of the identity theft complaints to the FTC last year, according to the agency.

Visa, the world's largest credit card company, is a member of the ITAA-led coalition, but could not be immediately reached for comment.

Alorie Gilbert writes for News.com