The New York Times reports that protectors, too, gather profits from identity theft:
It is not just criminals who are profiting from identity theft; financial institutions are making money, too. Fear of identity theft has helped give rise to a nearly billion-dollar business in credit-monitoring services sold by the major credit bureaus – companies like Equifax, Experian and TransUnion – as well as direct marketers and banks.
I have always been suspicious of industries peddling security. Why? Because it is in their best interest for us to feel insecure, not for us to feel secure. How many home security systems are going to be sold if no homes are being burglarized? How many anti-virus applications are going to be sold if no computers are being infected? The claim that the reason there are no burglaries or infections is that you have purchased and installed security can only go so far. Remember the story about the man standing in the middle of the street jumping around and waving his arms? When asked about his strange behavior he said that he was keeping the elephants away. How much are you willing to pay this man to guard your street?
I have no evidence that home security companies are burglarizing homes, that virus protection companies are spreading viruses, or that the credit bureaus are stealing identities. Most likely there are plenty of scumbags out there that do it on their own, but I’m still suspicious. After all, the protection rackets offered a form of security: If you pay us we won’t hurt you or trash your place of business.