How Identity Theft Is Like the Ford Pinto

Over on Concurring Opinions, Dan Solove describes a new paper by Chris Hoofnagle:

Professor James Grimmelmann likes to shop at Kohl’s.  So much so that he applied for credit at Kohl’s.  And he got it.

The problem is that James Grimmelmann didn’t really apply for anything.  It was an identity thief.

Grimmelmann was a participant in Chris Hoofnagle’s study about identity theft.  In a really eye-opening paper, Internalizing Identity Theft, 2010 UCLA J. of L. & Tech (forthcoming), Hoofnagle has concluded that one of the main reasons identity theft happens is because companies let it happen.  It is an economic decision.

Back in 1981, in the famous case involving an accident due to a defect in a Ford Pinto, it came to light that Ford knew about the design defect in the car but ignored it because it calculated that paying damages in lawsuits would be less than fixing the design flaw.

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