[avgcorrection]

> I don't know that I agree with the ethical conclusion that the optimal amount of fraud is therefore non-zero. The leap from "anti-fraud efforts are expensive" to these sentences in the final paragraph was not, in my opinion, convincingly made here

It’s like saying that the optimal dirtiness after cleaning your house is non-zero (greater than zero) because cleaning it perfectly takes much more effort than it is worth!

That’s not counter-intuitive at all. It’s just an obvious fact stated in a silly way (for clicks or whatever else).

[Taywee]

That doesn't mean that the optimal amount is nonzero. Taken in isolation, the optimal amount is clearly zero. The optimal amount doesn't change based on the cost, the optimal amount of effort to expend is a different answer.

It's not just stated in a silly way, it's stated in a way that's incorrect because they didn't mean what they said. "The optimal amount of fraud is nonzero" does not actually mean the exact same thing as "in an optimally-beneficial fraud prevention effort, the amount of fraud is non-zero".

[jasode]

>Taken in isolation, the optimal amount is clearly zero.

But the very point of the article is to not take zero-fraud in isolation and instead, explain how non-zero-fraud is an unavoidable tradeoff when balancing 2 simultaneous goals:

- (1) prevent fraud transactions as much as practically possible

- (2) make legitimate transactions as easy as possible

If one accepts the premise of pursuing those 2 goals at the same time, then by definition, we're no longer talking about "in isolation". You've now unavoidably entered non-zero fraud territory.

Perhaps it's the author's particular wordsmithing of what he's trying to convey that just rubs many readers the wrong way.

[awillen]

> Taken in isolation, the optimal amount is clearly zero.

The post makes it clear that the discussion is not about theory or taking anything in isolation - it's about fraud in the real world. In that context, the way it's stated is correct - if you have zero fraud in the real world, that means that you designed the tradeoffs wrong and that the cost of your fraud prevention (in terms of actual dollars as well as inconvenience to customers, etc.) is greater than the overall cost would be if you allowed a small amount of fraud to occur (looking at the total cost of that fraud as well as the cost of preventing additional fraud).

I suppose the problem is that whether or not the title of the post is true or not depends on the context in which it's taken, and the title itself doesn't have any context. Since the post does offer context, though, I think it's reasonable to take the title in that context.

[nocman]

> "in an optimally-beneficial fraud prevention effort, the amount of fraud is non-zero".

Yeah, but that phrase won't get any clicks.

I gave up about half way through the article and just skimmed through the rest.

[avgcorrection]

Yeah, I agree.

[LanternLight83]

It's like cleaning old painted metal with a scouring pad; You want to clean thoroughly enough to take off the grime, but if you scour too long or too hard you'll end up taking off the paint itself. You'll always either leave a littke dirt behind, or take off some paint, never perfection. You could strip all the paint and repaint it, but that's so much more costly in terms of time and materials that it's a whole different task.

And the argument that more stringent anti-fraud protections increase the burdon on legitimate claimants is absolutely spot on, and has parallels in all sorts of other legal, financial, and market situations c: