Online fraud damages Canadian identity infrastructure, says privacy commissioner

The Ontario Privacy Commission wants to develop a universal identification system to combat Web-based fraud.

Privacy Commissioner Ann Cavoukian said growing online fraud has damaged the identity infrastructure of the Internet-based commerce.

Cavoukian and U.S.-based senior executives of Microsoft Corp. are set to hold a press conference today where the commissioner is expected to discuss the need to develop a universal identity system to help defeat scammer.

The commissioner’s office, however, declined any interviews pending today’s event, which will also coincide with the annual conference of the International Association of Privacy Professionals.

At least one e-commerce expert believes that such a universal ID system would be difficult to set up because of potential disagreements between the various technology companies that would need to get involved.

Each of these companies – vying for a piece of the action – would want to have their standards adopted by the industry, said Tim Richardson, professor of e-commerce, marketing and international business at the Seneca College and instructor at the University of Toronto.

“On-line fraud is certainly an impediment, but I think a universal identity system will be difficult to deploy,” he said.

Richardson, author of e-commerce books and former executive director of the Canada-Japan Trade Council, said Microsoft has been working on developing such an ID system as well as an on-line payment scheme referred to in the industry as Microsoft dollars.

“These systems will require standards,” he said. “The difficulty is in determining whose standards will prevail, there are just too many players jostling for position on this field.”

But if it can be pulled off, Richardson said a universal ID system, with beefed-up security features for protecting personal data, certainly has the potential to reduce on-line fraud.

“[It’s] a step in the right direction,” he said. “Canada has in fact made some headway in similar areas such as biometric controls on passports.”

With the phenomenal growth of e-commerce, online fraud has grown as well, according to Richardson.

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