If anything, the fact that someone stole his ID and got caught proves his service works. He doesn't guarantee that your ID won't be stolen, just that you will know about it and be protected if it does. I am sure you can find cheaper services but if people are willing to pay for this service, then so be it.

As for the folks talking about the "obvious places" line, do you not think that you are agreeing to the same common sense approach everytime you sign anything financially? Is a car insurance company going to pay your claim if you left your keys out in the open? Yeah, probably not. These companies are for profit. They are not in existence to cover stupidity, there is too much of that going around for them to stay in existence if they were.