Three out of four consumers will go elsewhere rather than do business with a company that has publicly breached customer confidentiality.
This finding comes from a survey of 1,500 consumers by credit-vetting agency Experian. It suggests how effective a law could be that compelled companies to disclose such breaches, as recommended last week by the House of Lords Select Committee on Science & Technology.
Experian found that 37% of financial services organisations and 27% of retailers think that identity fraud publicity would have no effect on their reputation. "This is wildly out of touch with consumer opinion," the credit agency said.
The lords backed Experian's view. "The steps currently being taken by many businesses trading over the internet to protect their customers' personal information are inadequate," they said.
"The refusal of the financial services sector in particular to accept responsibility for the security of personal information is disturbing, and is compounded by apparent indifference at government level."
Experian fraud expert Anne Green said, "Companies are clearly blind to the negative publicity associated with identity fraud. They are not only playing Russian roulette with their own exposure to potential fraud, but also with their customers'."
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