> “ Or someone else may steal your private key and use it to sign transactions to their benefit verified by your good public key.”
Yes, that’s what is happening on a very large scale without victims knowing anything about it.
> “If you don’t manage your private key properly, then someone else can use it to sign a transaction to their benefit.”
Exactly, most people today are clueless. They haven’t any idea what a digital key is, public or private. Even if they start to wake up to the existence of such digital objects and processes, they have no clue as to how to manage it. Hence, society is about to get schooled on a whole new thing, a paradigm shift is in the works.
The people that are behind the current crime are killers. Have to be very careful to lay low when moving against them. Similar to the Al Capone crime syndicate from a century ago, they control judges, some law enforcement, investment bankers, hedge funds, and offshore banks.
The scheme works digitally. A simplified description is that of signing up an investor to a hypothecation agreement using electronic signatures, electronic records, using the identity and signature to create a digital Power of Attorney that bars the investor from seeing the private side (firewall) and using the investor’s private digital keys hundreds of times over in different investment vehicles. In a sense, a person, their corporate person becomes a fractionalized digital entity that is abused.
Traceability is not through contract or agreement assignments and transfers. The handoffs are abusively executed via the USPTO via copyright and trademark assignments. That way others in the scheme gain rights to the systems using the identities of pooled investors. It’s identity theft done inside the esoteric world of investment bond issuance processes. One thing they do is to sell the investors into Treasury strips hundreds of times over creating a huge Ponzi scheme. By using strips, no payment stream of interest is due, only the face value at maturity.
All of this scheme is supported by the illicit use of digital private keys. Investors including 401k account holders are going to have to learn to reclaim the PKI private digital keys that were stolen from them, then repudiate all others holding those private keys and to remove all POAs to see what has been done in their names. Finally, they will need to collapse the tax shelters containing the assets in their names that they previously had no knowledge of. They do this by following certain IRS procedures. The IRS will then work with them (because they are now a secured creditor) to recover taxes that were not paid because of tax evasion.
If a 401k account holder uses an investment fund by proxy (as many do), the investment advisor may not be in on the crime but the information flow can at some point in the chain get in the digital world of those that work this scheme.
I've established power of attorney with a small bank in another state and that required faxed signatures, phone calls, more faxed identity documents, etc. Very difficult for me to fake an identity and do that. But that's a small local bank who actually cares about their customers. I can see how what I did might be possible on an industrial scale with giant banks that don't give a crap. But I don't know how the rest of what you are describing works.