My reading of this situation is that the person who wrote the article did something that got their account flagged as "this looks like a spammer we previously kicked off our service", at which point the automatic system kicked in to ask him for a copy of an ID because it thought he was probably some Russian or Chinese scammer. Yes, there are false positives, but even at the best hosting companies, there's a constant stream of foreign spammers and scammers. Constant. Like, multiple obvious questionable contacts per day for every single support/sales person on staff.
This is pretty much how it works at any major low-cost hosting company. EIG's awful customer service system (which is centralized across all the companies they own) means that they take forever to process everything, but any hosting company with prices low enough to have to deal with mass fraud is going to have similar procedures. It'll just at best (like it was at the company I worked for pre-acquisition) be somewhere where you can talk to a fraud specialist immediately on the phone, fax in a copy of an ID, and have your site back up in a half hour.
Also, of course the support person closed the chat. What the hell do you expect when you start talking about Homeland Security and the TSA? This is some guy in a cubicle who has no power to change policies and is trying to handle a half-dozen upset customers at once. He doesn't have time for your crap.
That said, look for services with a minimum term of a year (this lowers spammer numbers quite a bit), and look for services that have multiple contact methods including an actual physical mailing address listed on their site (even if it's just a PO Box, it shows that they're probably not a reseller... there are lot of resellers out there).
And avoid companies owned by EIG or GoDaddy (some web searching will get you lists for both)—they're both just too big and too disorganized to provide adequate levels of support.
Sorry, you lost all my sympathy there where you start clearly making fun of the person's income for doing what they were trained to do and paid to do.
Sigh.
Cheap services make scammers and spammers more likely to show up, not less.
Sigh. Nasty to watch what HostGator did too, though.
Seriously what possible reason can they have for this for simple web hosting? What are they afraid of or is there some financial angle?
Scammers who use stolen credit cards and Paypal accounts to purchase cheap bulk hosting and send out floods of spam emails (before the account gets shut down) and/or set up imitations of other websites for phishing attacks.
Simple, cheap web hosting makes this more of a problem, not less.
* They own Hostgator, Bluehost, Startlogic, Bizland, iPower, Startlogic, Fatcow, iPage, JustHost, MyDomain, Homestead, NetFirms, and a couple dozen other companies.
† They own MediaTemple, Wild West Domains, BlueRazor, and I think a couple of other companies.
