This is not the issue here. If a bank want to do this, go ahead, as long as they cover the losses. The problematic part is that if a bank gives a loan in my name to someone else, I get punished for it, not the bank.
Or explain that you don't understand the industry or any of the regulatory frameworks involved.
Have you ever accepted a payment?
EDIT: not sure if I misread you, probably responding to a comment in flight. Your initial position seemed to be different to what I read now. I get that "identity fraud" as an industry position is a shitty attempt at moving risk but that was not the comment I was reponding to. Sorry if that sucks.
If I publish your nude pictures in a newspaper, you are similarly not a party to this transaction, but you are hurt by it. This is similar.
Everyone absolutely wants to extend you credit.
They're saying the problem is this:
You want to do business with company A. Company A asks company B for information about you. Company B lies to company A. Now company A won't do business with you, because company B lied about you.
Company B in this scenario is a company like Experian.
Cheaper for the banks, sure. It was cheaper for Ford to pay injury lawsuits than fix their exploding tires. But kind of trade off is illegal for one to make when another party is getting materially hurt — even if on average society is better off; after all, if we confiscated all of bill gates’ wealth, on average society is better off than if he gets to keep it.
You argue that there are reasons for the lack in verifications and then that this is desiderable from a societal point of view.
To the question "should a CC provider cover the expenses on CC give to fraudolent impersonators?" what do you answer?
I am sort of surprised more HNers don't understand risk and the tradeoffs involved and seem to be taking an absolutist stance on this.
Equifax is an unforgivable failure of infosec but the general ideas around the risk of it seem like ...
Practically speaking, without significant landscape changes (and yeah equifax counts as one) it has generally been cheaper to trust people and write off the bad apples than to verify more. Or else there would be more verification!
Thats because most applications for homes, high value insurance or financial products are not actual fraud, they are usually consumers having trouble with you shitty process despite your best efforts to optimise for usability.
I don't know fully what the equifaxopocalypse means for americans though.