As long as we are willing to relinquish some personal data, Web applications have long allowed us to create virtual identities that can conduct most of the social and financial transactions that typify life in the real world.
As a tech geek I have been at the fore using a lot of these applications to live my online life with easy. However this ease of use does come with an increased risk of fraud and potential misuse of data and the publics trust.
But the newest generation of these services is starting to collect and store far more than just the standard suite of identity data — name and address, phone, Social Security or credit-card numbers — that populates the databases of banks and credit-card processors. They increasingly store information, generated by us, that is directly linked to those virtual identities.
I have often worried about this. Not so much that it keeps me up at night but enough that I routinely review the privacy and usage policies of these sites. I have to trust that the companies will do what they said they would. I believe that these companies have a lot to use if they misuse any information provided by the customer. It has taken people a long time to even consider moving their lives (mostly electronic banking and shopping ) online and news of any kind of impropriety would spread like wildfire on the ‘Net.
One site that I have been excited about lately is Mint.
In exchange for customers uploading their account information and allowing sponsors to offer them specialized services, Mint will connect nightly to their credit-card providers, banks and credit unions. Then it automatically updates transactions and accounts, balances their checkbooks, categorizes their transactions, compares cash with debt and, based on their personal spending habits, shops for better rates on new accounts and credit cards.
Wow! Now that is what I had expected from Quicken. Quicken stopped being useful to me a few years ago. Despite having hooks into all the major banks for electronic download and submittal of transactions I found myself asking “where’s the value in this?”. Yes, I can graph my net-worth and spending trends but I wanted deeper analysis and I wanted to take a look at my financial picture at any time. Not just when I was on the one computer with and installed copy of Quicken.
However, these online services do collect a significant amount of personal data and with all the linking and connecting etc. there is a real risk that a compromise in one service and lead to failure in another.
As a result, some security experts are starting to ask whether the “identity data-for-services” business model, which is the engine for virtually all e-commerce companies, is a fair trade — not just for consumers, but for business as well.
Security researchers and professionals are working on ways to facilitate collaboration and transactions without the need for extensive data sharing.
To this end, Mr. Neuenschwander and his colleagues have floated the intriguing concept of the L.L.P.: the Limited Liability Persona. This persona would be a legally recognized virtual person in which users could “invest” the financial or identity resources of their choosing.
But if a company loses or tampers with an L.L.P’s data, “the law allows me to sue them because it’s corporate information,” Mr. Neuenschwander said. “It’s digital-rights management,” he added, referring to the access control technologies used by publishers and other copyright holders to limit use of digital media, “only you’re acting on behalf of your own organization.”
Sound like the idea is to extend the concept of the corporation ( a Limited Liability Corporation or LLC ) to the individual. Sounds like a great idea. Corporations sometime seem to enjoy more rights that private citizens and this may be one way to deal with them on somewhat even footing. Do I get the tax breaks as well?
(Via The New York Times.)