He's probably thinking that it will protect against Keyloggers, however.. there's a small flaw in the logic of scrambling the keyboard data.
The
good keyloggers hook onto your keyboard driver, then detect what key is being pressed, not the actual letter, but the key. There would be no way to scramble this as your operating system would not be able to detect what the keyboard is trying to type.
Also, some keyloggers take screenshots, hook onto your browser, etc. you never know where they are. You might eliminate a
part of it, but there's normally more to it