Identity Theft: Good News-Bad News Edition

So which would you like first? 

Javelin Strategy & Research said identity theft incidents were down 28% in 2010 (vs. 2009) according to their latest consumer survey.  This is the lowest level since 2007 and about 3 million less victims than in 2009.  They partially attribute this to a decline in industry reported data breaches going from 604 (221 million exposed records) to 404 (26 million exposed records) in 2010 along with economic conditions, better security measures and busts by law enforcement playing a major role.  If you have an existing credit card account, there’s good news on that front also – fraud from existing credit cards was down 38% ($14 billion) compared to 2009 ($23 billion).  New account fraud, where the victim might not have any idea than an account was opened in their name, took top honors in types of fraud with $17 billion siphoned.  ‘Change in physical address’ was the No. 1 method of account takeover reported by victims.

Don’t drop the confetti yet, however.  While the overall numbers look encouraging, the devil is in the details as the cliché goes.  Even thought the overall numbers are down, the consumer out-of-pocket expense to resolve ID fraud went from $387 per incident to $631 in 2010 – a 63% increase.  Because criminals are using more clever ways to steal you data, you have to spend more time fixing the issue and the costs can grew.  Your friends and family are also sticking it to ya. ‘Friendly Fraud,’ when someone you know steals your info, increased 7% with 41% of this batch saying their SSN was stolen.

They also found a correlation between retail sales and identity fraud.  When sales are up, fraud is down and when sales are down, fraud goes up, says James Van Dyke, founder of Javelin Strategy & Research.  He feels that when the economy is doing well and people can make purchases with their own money, they are less likely to steal.  Add to that, better security measures are in place and people are more aware of identify fraud, thus they keep a better eye on questionable transactions.  Another bad sign is that while credit card fraud has dropped, debit card fraud went from 26% to 36% in a year.  This could be due to more people using debit cards rather than credit for purchases but also due to debit’s lower level of protection when it comes to fraud. Some would question the validity of the survey since it is a ‘self-report’ telephone survey and bank data would argue that fraud is actually up in many areas.  There are many more intriguing tidbits in the report and you can check out Javelin’s report with a couple interesting charts here.

ps

Related:

• Identity Fraud Fell 28 Percent in 2010 According to New Javelin Strategy & Research Report
• Survey: Consumers say ID theft down 28%
• ID theft down 28 percent U.S. in 2010 – survey
• Statement from the Identity Theft Assistance Center on Report Citing Significant Decrease in Identity Theft
• Synthetic Identity Theft: The Silent Swindler
• Identity Theft Roundup
• The New Wallet: Is it Dumb to Carry a Smartphone?
• Dumpster Diving vs. The Bit Bucket
• Got a SSN I can Borrow?

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Identity Theft Roundup

I’m on a ID fraud kick lately and there are quite a few stories of late about identity theft.  Here are just a few:

House Approves Red Flags Exemptions – In January 2008, the Red Flag Rule went into existence which said that organizations (mainly banks and financial institutions) that extend credit to have a written Identity Theft Prevention Program designed to detect identity fraud on a day to day basis.  This new bill would except certain businesses like physicians and hospitals from having to abide by the rule.  Sen. Dodd (D-Conn) said that the bill, ‘makes clear that lawyers, doctors, dentists, orthodontists, pharmacists, veterinarians, accountants, nurse practitioners, social workers, other types of healthcare providers and other service providers will no longer be classified as 'creditors' for the purposes of the Red Flags Rule just because they do not receive payment in full from their clients at the time they provide their services, when they don't offer or maintain accounts that pose a reasonably foreseeable risk of identity theft.’  So if you don’t have a foreseeable risk of ID theft, I guess you don’t have to pay attention.

Minn. man pleads guilty in ND identity-theft case – 20 felonies, 19 counts of ID theft, 1 theft charge and a 28 year old only gets a year in jail and 5 years probation.  He stole the SSN and names of 49 people.
Military at high risk for identity theft – Did you know that military personnel are required to use their SSN for silly things like checking out a basketball at a gym or to identify their laundry bag?  I didn’t and it is becoming a problem since most locations do not take ‘care’ of that personal info.

Fla woman stole identity, paid for breast implants – You might remember this one where a woman in Miami stole someone’s identity and used fake credit cards to get her fake, well, you know.  She also racked up $20,000 in new furniture.  She got 30 months in a federal pen for that one.  If you were wondering, she said she needed them since her old ones were giving her breathing problems.

Kent couple arrested for identity theft, prescription forgeries – While investigating a prescription forgery ring, Kent Police uncovered a nice little counterfeiting operation run out of an apartment building.  Since the suspect was a convicted felon with a firearm, SWAT arrived and took the couple without incident.  Wait, fake prescriptions here and a new law that says medical facilities can pass on Red Flag?  Hum.

Man arrested in financial identity theft – It’s not just strangers getting hit – here a 20 year old opened a credit card account in his grandparent’s names and just added himself as an authorized user.  $4000 worth of cigs, alcohol and electronic equipment later, he was in jail.

Queens D.A. Warns: Beware New ID Theft – At least in New York, thieves are using what’s called a ‘spoof card’ to get personal information.  Spoof cards are like calling cards but allows the caller to enter whatever number they want on the receiver’s caller ID.  Oh, a call from the bank.  They act/sound all authoritative on the phone and people spill the info.  This is a great opportunity to turn the tables – ask the caller to validate a piece of information.  To validate the caller, ask a couple questions that the bank usually asks you like, last transaction or first dog’s name.  Or, just say, ‘I’ll call you back at the number on your web site.’

ID theft alleged at Libertyville driver's license facility – A 22 year employee at an Illinois driver’s license facility gets caught giving other’s personal information to thieves.  Those thieves then opened credit card accounts with the info.  He’s facing 3 years in prison but shows just how slippery your personal info is in the hands of others.

More to come…

ps

Related:

• Personal Data For Sale – In time for the Holidays!
• Synthetic Identity Theft: The Silent Swindler 
• Cybercrime, the Easy Way
• Dumpster Diving vs. The Bit Bucket
• Odds someone else has your SSN? One in 7
• Courts: Using another's SSN not a crime

twitter: @psilvas

Technorati Tags: F5, infrastructure 2.0, integration, cloud connect, Pete Silva, security, business, education, technology, application delivery, intercloud, cloud, context-aware, infrastructure 2.0, automation, web, internet, cybercrime, security, holiday shopping, identity theft, scam, email, data breach

Synthetic Identity Theft: The Silent Swindler

As a brief follow up to yesterday’s Got a SSN I Can Borrow, I came across this story from The Red Tape Chronicles saying the odds that someone else has used your Social Security Number is One in 7.  ID Analytics, a data collection and customer behavior analytics firm, works with organizations, including the US Social Security Administration, to detect Identity-Based fraud; separating the true customers from the impostors.  They’ve analyzed 290 million Social Security numbers and found that 40 million of those numbers have been connected to more than one name; basically, 40 million of us are sharing identities with someone else.  They also indicated that 6% of the total population, or 20 million Americans, have multiple SSNs associated with their name.  Often, it might just be an incorrect entry or typo into a system, but it can also be when criminals apply for credit at multiple banks changing 1 digit with each application – around 20% are deliberate misrepresentations.  When the system propagates either the error or intentional entry, that second SSN is forever associated with the individual and thus Synthetic.  Synthetic Identities are created when an unassigned number gets attached to someone and a new entity is created within the credit system.  Some people have 4-5 SSNs connected to their name and 5 million SSNs are connected to three or more people. 

Synthetic Identity Theft is typically when a criminal uses either totally fake or a mixture of fake and real information to create a new identity.  Usually, a fraudster will use a real SSN with a fake or different name that is associated with that number.  Synthetic Identity Theft is difficult to track, detect and report since individuals are usually not aware it is occurring since it doesn’t appear on a credit report and because a combination of names, addresses, SSNs and so forth are used, it is usually does not match up with a single, individual consumer to claim fraud.  Most go unreported and become ‘charge-offs’ within the financial institution well before anyone is aware of the problem.

Protect yourself by shredding mail and sensitive documents since thieves will dig through trash to find pieces of information they can use; review your Social Security benefits booklet every year to check if the income reported is actually what you made; and stay on top of your credit, reporting any discrepancies.  The free AnnualCreditReport.com is the official site to help consumers to obtain their free credit report each year.  I tend to grab all three at once since I subscribe to a credit monitoring service, but if you don’t – stagger each of three reporting agencies reports throughout the year to see any changes since the last credit file disclosure.  If necessary, you can also put a Security Freeze on your credit report.  Finally, don’t give out your Social Security number if you don’t have to – if someone asks, like a doctor’s office, just respectfully decline.  I have never had a problem telling someone that I prefer not to give out that sensitive information.  Heck, you could probably even say you’ve been a victim of Synthetic Identity Theft.

ps

Related:

• Odds someone else has your SSN? One in 7
• Synthetic ID Theft
• Another Synthetic Identity Theft Story
• ID Analytics
• Courts: Using another's SSN not a crime
• Colorado Supreme Court: Stolen SSN is not ID Theft
• Personal Data For Sale – In time for the Holidays!
• Cybercrime, the Easy Way
• Dumpster Diving vs. The Bit Bucket

twitter: @psilvas

Technorati Tags: F5, infrastructure 2.0, integration, cloud connect, Pete Silva, security, business, education, technology, application delivery, intercloud, cloud, context-aware, infrastructure 2.0, automation, web, internet, cybercrime, security, holiday shopping, identity theft, scam, email, data breach