The recent story on the twitter breach of company information reminded me of an interesting research I recently saw. A few researchers have worked with real people to gather data how well security questions used by online apps work. Their paper has all the glory details,but there are two things that stood out to me:

• secret questions are statistically easy to guess with just a bit of information about a person
• putting bogus data as the answers is doomed to fail

If one looks back in time, most (highly visible) account compromises happen through the password reset/recovery mechanisms, not through a vulnerability in the web application itself.
It is common for people to focus on the wrong thing to improve on. In addition to ensuring the security of the site, more research needs to be done in improving the authentication and recovery/revocation. With the growing popularity of social networks, finding information about people is trivial, so I think unless some changes are made, we will see more and more of these compromises.