simple security

While standing at the checkout lane this afternoon, I noticed that the cashier refused to accept the credit card from the guy who was standing ahead of me. He had not signed the back of his credit card yet. Instead he has written "See I.D." on the little white stripey thingy on the back of the card. The intention being, I presume, that the cashier/checkout guy would ask for an ID and as the ID contains both the photo and signature it makes the whole process more secure. Right? Wrong.

He asked the cashier why she was refusing to take the card. He said that the ID (drivers licence in this case) contained the signature also and the cashier could verify his signature on the receipt with the one on the drivers licence. She said that if the card is signed and if that guy refutes the transaction then it Visa/Mastercard/ or whoever issued the card has to pay-up. But if the card is not signed and if she relies on the ID then the liability shifts onto the them.

Look guys, I am no lawyer... but is this true? I know people who write "See ID" on the back of their cards and get away with it (atleast so far). Did she BS him or is that a factual thing?