After mistakenly leaving his wallet at a checkout counter in a local grocery store, a Texas man became a victim of one of the most detrimental non-violent crimes today: Identity Theft. A man identified only as R.E. could not imagine the time, effort, energy, emotion, and money he would soon have to devote towards proving to the world that he was indeed a victim. R.E’s attacker, the employee operating the register, began by charging close to $500 in groceries—at the same store! The attacker continued the spree by opening accounts with various department stores and credit card companies. (R.E., 2001) According to R.E’s testimonial on privacyrights.org, most of the accounts were opened online, which can be done with ease as there is no additional verification required other than a social security number and other general information.
In his attempt to regain control of his credit and remove the thousands of dollars in debt created by his attacker, R.E. found himself surrounded by disbelief and inattentiveness toward his issue. In his case, the lack of interest on the part of law enforcement and company theft divisions gave his attacker more time to commit larger offenses and open larger accounts under his identity. Even after R.E contacted hisDistrict Attorney’s office; the Department of Public Safety; the Federal Trade Commission (FTC); the Social Security Administration (SSA); the Postal Inspector; the Secret Service; the Department of Justice; the Dallas Police Department’s Financial Crimes division; the Office of the Comptroller of the Currency; and the Texas Attorney General’s office, the attacker was able to continue opening accounts with R.E’s identity. (R.E., 2001)
Like the millions of other identity theft cases, R.E was forced to undergo hardships and financial despair for years without sufficient help from authorities. On November 1, 1999 the FTC established the Identity Theft Hotline to track consumer complaints. In 2001 a report of calls to the hotline showed 97,000 entries. The report also shows that of the 64% of victims that contacted law enforcement prior to contacting the hotline, only 72% had police reports generated. (Matejkovic & Lahey, 2001) It might be safe to say that the government, corporations, and consumers treat identity theft differently.
The US Department of Justice defines identity theft as,
Knowingly transferring or using without lawful authority, a means of identification of another person with the intent to commit or to aid or abet any unlawful activity that constitutes a violation of federal law, or that constitutes a felony under any applicable state or local law. (Justice, 2006)
Victims of identity theft have an extremely difficult time fixing the damage caused by identity theft. Since the only thing a thief needs to accomplish the crime is a Social Security Number (SSN), which is widely used as a method of identification, it can take months and even years to detect. So how does a victim begin restoring his or her identity? This question can prove more difficult for victims than government officials can understand, and more complicated than small companies can handle. Since smaller banks such as community banks with assets under $500 million do not have a large enough expense accounts to properly handle fraud cases, crimes committed with accounts under these companies often stay unresolved. (Slosrik, 2002) Since the amounts stolen in these cases are usually low, these banks tend to write them off as loses. Even though these banks may be able to write off these amounts as losses, the account holders are not often able to be so lenient.
Once a person realizes his or her account has been tampered with, he or she must then begin the agonizing struggle of getting his or her money back and in some cases, regaining control of the account. Bank of America’s website provides just a few steps for handling identity theft. The website lists that victims must first contact the fraud departments at the three major credit bureaus: Experian; TransUnion; and Equifax, close accounts that have been tampered with, file a police report, and file a complaint with the FTC. These steps do not even come close to the amount of work that is required to resolve an identity theft case, which is depicted in R.E’s testimonial on privacyrights.org. It is also important to note that every step of the process to regaining one’s identity must be completed solely by the victim. (Slosrik, 2002)
More than a decade ago stealing another person’s identity was not a crime. In 1998 President Clinton signed the Identity Theft and Assumption Deterrence Act (ITADA) making identity theft a federal offense. If caught, criminals would face up to 20 years in prison, or a fine of up to $250,000. (Slosrik, 2002) Consumers however, believed that the penalties were not strong enough, so in 2004 President Bush signed into law the Identity Theft Penalty Enhancement Act. This immediately created a higher level of identity theft called aggravated identity theft, which involves identity theft linked with terrorism, and increased penalties for such crimes. The Act increased the maximum sentence for identity theft from 3 to 5 years, and the maximum sentence for aggravated identity theft increased by five years to a total of 25 years imprisonment. (Punishment for identity theft, 2006)
Even with actions taken toward offenders, victims cannot help but feel as though that little effort has been made in preventing the crimes, and law enforcement is not motivated or equipped enough to investigate them. Many victims say they feel neglected by law enforcement when reporting identity theft crimes. In his testimonial R. E. writes, “pessimism by the detectives that anyone will be caught” is the reason law enforcement has not taken action on her claim. He also describes this as “the only crime where the suspect is presumed innocent before proven guilty and the victim is guilty until proven innocent.” (R.E., 2001)
Though companies take losses from crimes such as these, the losses do not compare to the turmoil unleashed upon victims directly affected by the crimes. Because there are so many ways to steal a person’s identity, it is nearly impossible to prevent such crimes. Criminals search through trash, steal or reroute mail, intercept personal information over the internet, or peek over shoulders at checkout counters and ATMs. The outcomes of the crime can leave victims feeling depressed, isolated, helpless, and/or frustrated. Some effects of identity theft are difficulty obtaining loans, denied credit, bankruptcy, false arrests, denied employment, and evictions. (Slosrik, 2002) The use of a victim’s information varies. A 2004 survey of identity theft victims by the Javelin Strategy and Research organization breaks categorizes the uses of such sensitive information. Illustration 1 shows this breakdown.
(Morris, Johnson, & Kercher, 2005) Illustration 1
Preventing and resolving identity theft is not only an issue between companies and consumers, but also employers and employees. Employees that hold positions that deal with sensitive information are easily capable of committing identity theft. Jamie Lynn Roush is an example of one such case. While employed at Pizza Hut in 2008, Roush bought $6,700 worth of merchandise via the internet using customer bank card numbers. (Benamati, 2008) Another incident took place when a CEO of a computer company, Terrence D. Clark, used client and employee information to apply for loans and credit cards in 2006. (Mehta, 2006) Cases such as these show how easily employees are able to use sensitive information for their own personal gain. Since the responsibility of protecting consumer and employee information falls heavy on the shoulders of the companies, it is safe to conclude that businesses are not doing enough to protect such sensitive information.
In a study of Fortune 500 companies David Linowe found that 70 percent of the companies surveyed disclosed personal information to nongovernment credit grantors, 47 percent gave information to landlords, and 19 percent gave information to charitable organizations. Illustration 2 shows the breakdown of the release of information.
(Lynn, 1996) Illustration 2
As another example of the lack of efforts on the part of businesses, Bernie, a member of a 401K plan at a bank complains of having to input his social security number into the telephone when calling the bank’s automated service. The bank also lists social security numbers above the mailing address on the website. Bernie suggests that these practices have good potential for fraud. (Cases From the PRC Hotline, 1996) A large contributor to the problem is that employers are putting social security numbers on unnecessary documents. Not all documents need social security numbers printed on them. Using ‘x’ for the first five numbers, revealing only the last four is a better way to secure confidential information.
The time, money and emotion spent trying to fix one’s credit after an identity theft is priceless. Victims must go through a rigorous process in attempt to prove they are innocent. According to Experian.com, a website for one of the three major credit bureaus, negative changes made to a credit report can take between 7 and 15 years to be removed. (Improve Your Credit Score, 2010) Over the past year, identity theft rates have increased due to the poor economy. When the economy is bad, consumers are more negligent with their information, which in turn makes them easier targets. When facing hardships, consumers often gamble with business ventures or fall into online scams claiming to have the best deals. During economic struggles, consumers open more credit card accounts with higher interest rates and more fees.
Additionally, when the economy is bad criminals are more determined to commit the offense. According to the 2009 Identity Fraud Survey Report, in the year 2009 identity theft rates increased 22%. When an economy struggles, people are forced to find new ways to make money. Businesses also suffer during economic hardships, so finding a job can be much more difficult. Criminals may feel more driven to steal money knowing it is not easily earned during economic hardships.
The lack of effort from businesses in protecting consumer and employee information has aided in the increase in identity theft rates. Responsibility for preventing and fixing such crimes should not fall entirely on the victims. Both the government and the companies should be held responsible for protecting consumer and employee information. More programs should be implemented within companies to ensure that employees are not able to gain sensitive information about clients, customers, and/or co-workers.
Although there is no way to protect yourself against identity theft, there are numerous actions you can take to lower your chances of becoming a victim. Credit card companies and banks sometimes provide identity theft protection, or reimbursement for fraud cases. You should check your credit report more frequently to make sure there are no unauthorized changes or credit checks. Also, shred any and all documents that contain confidential information. Look for and verify security on websites when making purchases online. Never allow your credit card to be taken out of your sight when shopping or eating out. It is estimated that 1 in 4 people will become victims of identity theft. Understanding the risks as well as knowing how to fix the damage caused is most important when dealing with this crime. Following these simple guidelines and taking action as quickly as possible will not only make the process easier, but could prevent you from additional attacks. Anyone can become a victim of identity theft, so it is important to monitor your credit report regularly. So i ask you, how often will you check your credit report?
Benamati, J. (2008). Former Pizza Hut Employee Arrested in Identity Theft of Customers. The Tribune Democrat . Retrieved January 22, 2010 from http://www.tribune-democrat.com/local/local_story_022230152.html
Cases From the PRC Hotline. (1996). Retrieved December 11, 2009, from Privacy Rights Clearinghouse: http://www.privacyrights.org/cases/cases2.htm
Improve Your Credit Score. (2010). Retrieved January 2, 2010, from Experian: http://www.experian.com/credit-education/improve-credit-score.html
Justice, U. D. (2006). A National Strategy to Combat Identity Theft. Retrieved December 12, 2009, from US Department of Justice: http://www.cops.usdoj.gov/files/ric/Publications/e03062303.pdf
Lynn, A. (1996). Retrieved December 4, 2009, from Electronic Privacy Information Center: http://epic.org/privacy/workplace/linowesPR.html
Matejkovic, J. E., & Lahey, K. E. (2001). Identity Theft: No Help for Consumers. Retrieved January 5, 2010, from http://search.ebscohost.com/login.aspx?direct=true&db=f5h&AN=7139800&site=ehost-live
Mehta, S. (2006). Fortune. Retrieved January 2, 2010, from CNNMoney: http://money.cnn.com/magazines/fortune/fortune_archive/2006/12/11/8395384/index.htm
Monahan, M., & Kim, R. (2009). Retrieved December 11, 2009, from 2009 Identity Fraud Survey Report: http://www.javelinstrategy.com/uploads/901.R_IdentityFraudSurveyBrochure.pdf
Morris, R., Johnson, M., & Kercher, G. (2005). Identity Theft: A Research Report. Retrieved December 15, 2009, from http://www.crimevictimsinstitute.org/documents/id_theft_report.pdf
Punishment for identity theft. (2006). Retrieved January 2, 2010, from Identity Theft Awarness: http://www.identity-theft-awareness.com/punishment-for-identity-theft.html
R.E. (2001, October 1). Cases. Retrieved December 14, 2009, from Privacy Rights Clearinghouse: http://www.privacyrights.org/cases/victim15.htm
Slosrik, K. (2002). Identity Theft: An Overview of the Problem. Justice Professional, 15 (4), 329.Retrieved January 22, 2010 from http://search.ebscohost.com/login.aspx?direct=true&db=bth&AN=9360871&site=ehost-live