Identity theft is the fastest-growing crime in the U.S. In 2003, 9.9 million Americans suffered some form of identity theft. Compare this to 1997, when there were roughly 400,000 cases of identity theft. This huge increase is directly related to the increase in the use of the internet. The criminal never has to see the victim or know what suffering has been caused. This is a problem that hurts all of us, as much of the cost is ultimately passed along to the general public. The law puts a $50 limit on the amount that a creditor can recover from an identity theft victim if creditors are informed right away, and many creditors will waive even that fee.
Identity thieves can access your bank or brokerage accounts, withdraw your funds, and make charges to your credit cards. They steal your Social Security checks, refinance your home without your knowledge, take out loans in your name, and purchase or lease autos. They can open new credit cards in your name, using a bogus mailing address. By the time you realize there’s a problem, bills have been mounting for months. Most victims first learn of the problem when they are denied credit or loans due to negative credit reports that result from fraudulent activity. An identity thief can even leave you with a criminal record that you know nothing about.
Undoing the damage caused by identity theft can take years, and sometimes the harm is irreparable. The average victim spends more than $1,000 in personal funds and more than 175 hours (a month’s full-time work) attempting to undo the damage, if it can be undone. 45% of victims resolve their cases in about 2 years, but for the majority, their problems continue for four years or longer.
TYPES OF IDENTITY THEFT
THE TWO-STEP CRIME COMBINATION
Step One: Covert acquisition of “personal identifying information.” The most common information that ID thieves want is your name, Social Security number, date of birth, and sometimes your mother’s maiden name, but other information can be just as important. Other examples include your address, telephone number, driver’s license number, PIN (personal identification number), passport number, alien registration number, checking or savings account number, or credit card numbers.
Step Two: The illegal use of someone else’s personal identifying information to steal from the victim, incur debt in the name of the victim, or other wrongdoing.
HOW IDENTITY THEFT OCCURS
Computer hacking/Spyware: Programs or hackers that work behind the active programs being used to acquire personal information from your computer without your knowledge when you are connected to the internet.
Internet “Phishing”: E-mail messages that request some sort of personal identifying information under the guise of something appearing legitimate, such as a message that appears to come from a bank or credit card company or someplace like e-bay or AOL. Typically, these messages ask you to confirm your Social Security number or some other confidential information. NEVER respond to any e-mail asking for personal information.
Telephone “Phishing”: Same idea, only you get a telephone call from someone purporting to be a representative calling for “your bank” to “confirm” certain information, often trying to convey some sense of urgency. They may even tell you they are concerned that someone may be attempting to steal your identity! Do not reveal personal information over the phone. If your bank needs some personal information from you, go to your bank to give it to them.
“Shoulder Surfing”: Someone surreptitiously observes you entering your PIN. If they can also get your account number, this makes it possible for them to access your account.
Mail Theft: If your mail is delivered to an unlocked mail box in a publicly accessible area, this is a target for those who would intercept credit card offers or the actual credit cards that come in the mail. Outgoing mail left in your mailbox is another target for ID thieves. They look for outgoing checks signed by you that they can steal and alter with an acid wash to then make the check payable to themselves or to “cash” for a substantial sum.
“Dumpster Diving”: The ID thief goes through the trash of well-to-do persons looking for bank or other financial statements, ATM or credit card receipts, and pre-approved credit card offers.
Corrupt Insider with Access: An unethical employee who has access to personal information such as your Social Security number and date of birth may sell this information to others or use the information themselves. This can be very difficult to protect yourself against.
Identity Fraud: Persons posing as someone (such as an employer or a landlord) who would normally have a legitimate right to your credit report or your personal information.
Larceny: Pickpockets could sell your credit cards or personal information to ID thieves.
Retailer/Creditor Negligence: Failure to properly protect the confidentiality of customer credit card numbers.
HOW CAN YOU PROTECT YOURSELF AND PREVENT IDENTITY THEFT?
WHAT SHOULD I DO IF IT HAPPENS TO ME?
Act quickly to report it! As of 1/1/2004, California state law requires the victim to provide a security alert to all applicable credit bureaus within 5 days of discovery of the fraudulent activity or face a $2,500 fine plus attorney’s fees [since 2003, a notice to one is a notice to all]. Once the security alert is in place, the credit bureau cannot extend any further credit to the victim or anyone else posing as the victim. Also, report the crime to your local police or sheriff’s department. Consider filing a court petition requesting a Certificate of Identity Theft -- Judicial Finding of Factual Innocence. Keep a detailed log of everything you do in attempting to resolve the problem. For more specific guidance, see separate handouts:
FOR MORE INFORMATION
Resources on the Internet:
Federal Trade Commission: www.consumer.gov/idtheft/ -- statistics, complaint forms, links to almost all other sources of information and assistance.
Guide for Assisting Identity Theft Victims: https://www.cboprf.com/GuideAssistingIdTheftVictims.pdf
Identity Theft Resource Center: www.idtheftcenter.org
Social Security Administration pamphlet re: Identity Theft and SS numbers: https://www.ssa.gov/pubs/EN-05-10064.pdf
California Department of Justice Privacy Enforcement and Protection: https://oag.ca.gov/privacy
Certificate of Factual Innocence: www.courtinfo.ca.gov/forms/documents/cr150.pdf
Test your identity risk factor: www.privacyrights.org/itrc-quiz1.htm
U.S. Dept. of Justice identity theft information: https://www.justice.gov/criminal-fraud/identity-theft/identity-theft-and-identity-fraud
CreditScore.net identity theft resources http://www.creditscore.net/identity-theft-resources/
Safeguard Your Identity and From Victim to Victor, both by Mari J. Frank
Identity Theft, by John R. Vacca