 The
Great Identity Heist
There is
more at stake than just cash
Financial
Privacy
Review Website Privacy Policies
If I'm a Victim, What Should
I Do?
Basics for preventing Identity
Theft
For more information...
Identity
Theft, ID harvesting, call it what you like--this
crime seems to have been invented for the Internet.
Believe it or not, a digit-savvy thief can steal
your personal identifying information and
clone a virtual you on the Internet. This criminal
will then use your good name and credit to get
online bank loans, cash and merchandise, then
vanish into the ether, leaving the banks and credit
card companies to absorb the losses. Meanwhile,
your credit rating hits the skids, and you may
face years of hassle with bill collectors and
credit agencies.
Thieves
have been using fraudulent account numbers for
years, but the Internet has expanded this crime
to a new dimension. The General Account Office
reports a steep rise in fraud victimization since
1992, and the Social Security Administration has
seen its misuse investigations nearly quadruple.
The National Fraud Center warns that the Internet's
anonymity makes it easier for thieves both to
access large databases and to cover their tracks.
The
FTC cites the following examples of Identity Theft:
- Spending
sprees using your credit and debit card account
numbers to buy “big-ticket” items
like computers that can easily be sold.
- Opening
a new credit card account, using your name,
date of birth, and/or Social Security Number.
When the offender fails to pay the bills, the
delinquent account is reported on your credit
report.
- Changing
the mailing address on your credit card account.
The imposter then runs up charges on the account.
Because the bills are being sent to the new
address, it may take some time before you realize
there is a problem.
- Taking
out auto loans in your name.
- Establishing
phone or wireless service in your name.
- Forging
checks or draining your bank account using debit
cards.
- Opening
a bank account in your name and writing bad
checks on that account.
- Filing
for bankruptcy under your name to avoid paying
debts or to avoid eviction.
- Giving
your name to the police during an arrest. If
the offender is released and fails to show up
for their court date, an arrest warrant could
be issued in your name.
Financial Privacy
Under Siege
Technology
teams up with financial services to threaten your
privacy
When
was the last time you paid cash for a major purchase?
Can you access and track your checking account
online? Do you enjoy the convenience of using
one institution for your banking, investment,
and insurance accounts? If you answered yes to
any of these questions that you have joined the
ranks of millions of Americans who have unknowingly
put their privacy at risk to take advantage of
the cheap and easy world of electronic finance.
Tracking
You on and off the Web
Banks, insurance companies, investment firms
and others have been quick to take advantage of
the convenient and affordable technology of the
Internet and increasingly powerful computer network
systems. This technology makes it easier for them
to serve you...and to know the ins and outs of
all of your business. In the past, most transactions
were carried out with cash. Aside from a store
clerk seeing your face as you made a purchase,
you were anonymous. The store did not track who
you were, what you purchased, or how often. Even
if you used a check, your bank typically did not
keep ledgers tracking to whom the check was written,
for what, how much, and when.
Credit
and debit cards have changed all of that. Your
purchase history is collected and stored by your
credit card company. Computerization of store
records allows credit card information to be matched
up with itemized purchase information, revealing
in startling detail your spending history. Monica
Lewinsky learned this the hard way when Kenneth
Starr suponead the bookstore she frequented for
a complete list of the books she purchased.
One
Big Happy Family
Spending history is just the tip of the iceburg.
In the past, banks were prohibited from selling
insurance and investments, and investment and
insurance companies were prohibited from owning
interest in banks. No more. The financial institution
deregulation of 1999 allows banks to get involved
in all sorts of transactions, and to merge with
insurance companies, investment firms and others.
This means that your bank now potentially has
access to your health insurance information, your
investment portfolio and other information in
addition to the information it already holds about
your credit card use and checking and savings
information. What's more, companies that are part
of the same "corporate family" are legally
able to share information that they hold about
your separate accounts. This leaves open the possibility
of your health records being revealed when the
bank is deciding whether or not you are a good
risk for auto insurance, or for a mortgage loan.
In some cases, these institutions are also empowered
to share information about you with third parties.
Consider
the following example, from Consumer Reports:
Citibank, the second largest American commercial
bank teamed up with Traveler's Group, a large
investment company that itself had previously
merged with investment firm Salmon Smith Barney.
The new company, Citigroup, now has over 100 million
customers, and access to their banking, insurance
and investment histories.
All
of this merging and consolidating can be convenient
for consumers, especially when teamed up with
the Internet. Now you can access your checking
account, track your investments and pay your car
insurance premium all in one place, maybe even
online. That also means that you are more vulnerable
than ever before to identity theft, fraud or simple
revelation of your personal information to anyone
who knows where to look.
In
January 2000, Chase Manhattan Banks settled charges
brought by the State of New York that the bank
was selling sensitive information on over 20 million
customers, including credit card numbers and account
balances, to maketing firms. Chase Manhattan agreed
to stop this practice as part of the settlement.
U.S.
Bancorp was also forced to stop selling customer
information to third party firms. U.S. Bancorp
not only sold the information, but opened its
customers up to additional abuse. Some of the
firms used the information to enroll U.S. Bancorp
customers in paid for automobile and travel clubs.
The customers, who did not ask for this membership,
had to contact the company to terminate their
free trial membership. If they did not, which
many didn't because they passed the trial membership
off as junkmail, the marketer used the credit
card number obtained from U.S. Bancorp to bill
the consumers for this service.
Another
threat exists when information that was legitimately
collected is reused for an unintended purpose.
For instance, consumers routinely agree to have
a physical exam when applying for life insurance.
But what if this information is accessed by your
bank when it is processing your request for a
higher credit limit, auto loan or mortgage? No
laws currently exist to protect you from this
sort of invasion.
It's
Not in the Fine Print
The bank deregulation guidelines require financial-services
forms to disclose their privacy policies, and
to send you an update once a year. They are also
required to notify you before they share your
information with a third party and to let you
opt-out if you don't want your information shared.
However, if your bank is allied or in partnerhip
with that "third party," they are not
required to disclose or inform you of any information
that may be shared.
The
Risks of Online Trading
Online trading has exploded in recent years,
causing cautious economic experts deep concern
about the impact to the stock market. It also
poses a risk to personal privacy. The Securities
and Exchange Commission reports that the number
of online accounts has grown from 3.7 million
in 1997 to 9.7 million in the second quarter of
this year. SEC Commissioner Laura Unger is concerned
what brokerages are doing with the information
they collect from online investors, and is looking
to Congress to regulate this burgeoning industry
more closely.
"While
the Internet has many benefits, a small group
of thieves is trying to hijack unsuspecting investors
on the information superhighway," said Richard
H. Walker, the SEC's Director of the Division
of Enforcement. The SEC has already brought more
than 30 cases involving Internet-related securities
fraud that have involved virtually every type
of investment scam, including phony offerings,
market manipulations, affinity frauds (e.g. frauds
that target a particular ethnic or religious group)
and pyramid schemes. The Enforcement Complaint
Center, the SEC's online communications center
on the World Wide Web, now receives more than
120 complaints every day concerning Internet-related
potential securities violations, many of which
provide good leads for investigations or relate
to existing investigations. "Since the first Internet-related
case we brought back in 1995 involving a scheme
to sell unregistered securities in a world-wide
telephone lottery over the Internet (SEC v. PleasureTime)
to our most recent case involving a $7.2 million
ponzi scheme peddled via the World Wide Web (SEC
v. Richmond), we have done our best to keep the
Internet safe for investors. With the launching
of this new unit we hope to beef up our Internet
presence and continue the success of our Internet
Program," said Mr. Walker.
 Privacy
Policies and Practices
Some sites
don't practice what they preach
Many
Web site home pages now include links to the site's
privacy policy. If the site you are shopping at
does not post a privacy policy, beware, and don't
shop there. Keep in mind that privacy policies
are statements of policy-they are not guarantees
that those policies are being followed. A recent
report by  researchers
at Georgetown University on the privacy policies
and practices of several high-profile health Web
sites found that many of them were saying one
thing and doing another.
Here are some ways
to ensure you get the privacy they promise:
- Always read the
privacy policy of any site you visit often.
Definitely read it before you submit personal
information.
- The seven main
points a privacy policy should cover are:
- What personal
information is collected
- Whether the
collection method is voluntary or involuntary
- How you can
access and change the information
- How the information
will be used
- Who--such as
third-party marketers--will have access
- How privacy
problems will be resolved
- What security
provisions have been made to protect the data
- Know the difference
between opt-in and
opt-out. Opt-in means a Web site will send
you products, services or emails only if you
sign on for them. Opt-out means you'll receive
certain services or messages automatically until
you go through the process of unsubscribing.
If you have a problem,
the law may provide redress. Although a privacy
policy is optional for most sites, once it's posted,
the Federal Trade Commission can - and has - sued
Web sites for violating their own privacy statements.
In
the event that I become a victim of Identity Theft,
what should I do?
The
Federal Trade Commission (“FTC”) advises
victims of Identity Theft to do the following:
- Contact
the fraud departments of any one of the three
major credit bureaus to place a fraud alert
on your credit file. The fraud alert requests
creditors to contact you before opening any
new accounts or making any changes to your existing
accounts. As soon as the credit bureau confirms
your fraud alert, the other two credit bureaus
will be automatically notified to place fraud
alerts, and all three credit reports will be
sent to you free of charge. Be aware that these
alerts expire and need to be renewed every 3-6
months.
- Close
the accounts that you know or believe have been
tampered with or opened fraudulently. Use the
ID Theft Affidavit when disputing new unauthorized
accounts. The affidavit can be found online
at: http://www.ftc.gov/bcp/conline/pubs/credit/affidavit.pdf
- File
a police report both with the jurisdiction in
which you live as well as in the jurisdiction
where the identity theft took place. Make sure
to obtain a copy of the report to submit to
your creditors and others who may require proof
of the crime.
-
File your complaint with the FTC. The FTC maintains
a database of identity theft cases used by law
enforcement agencies for investigations. Filing
a complaint also helps us learn more about identity
theft and the problems victims are having so
that we can better assist you. The complaint
form can be found online at: https://rn.ftc.gov/pls/dod/widtpubl$.startup?Z_ORG_CODE=PU03
You
may also want to check your identity status with
the following agencies:
1. Social Security Agency www.ssa.gov
2.
U.S. Passport Agency www.travel.state.gov
US Department of State
Passport Services
Consular Lost/Stolen Passport Section
1111 19th Street, NW, Suite 500
Washington, DC 20036
Or call 24 hours/day at: (202) 955-0430
Voice mail - For non-business hours, Eastern Time
3.
Department of Motor Vehicles www.traffic-school.org
This link provides links to every state Department
of Motor Vehicle or Motor Vehicle Administration
in the U.S.
4.
U.S. Postal Inspection Service www.usps.gov/websites/depart/inspect
Note
that this is the Federal Law Enforcement agency
that investigates identity theft cases. You can
contact the U.S. Postal Inspection Service in
four ways:
(a)
Mail correspondence to this address
INSPECTION SERVICE SUPPORT GROUP
ATTN: FRAUD SECTION
STE 1250
222 S RIVERSIDE PLAZA
CHICAGO IL 60606-6100
(b) Call your local Postal Inspector's
office. Visit their online office locator: http://www.usps.com/ncsc/locators/find-is.html
(c) Complete their online feedback
form: https://www.usps.com/postalinspectors/fraud/Feedback.htm
(d) Submit a Mail Fraud Report
online (https://www.usps.com/postalinspectors/fraud/MailFraudComplaint.htm)
if you have a complaint involving fraud and the
U.S. Mail.
Contact
check verification companies, especially if you
have had checks stolen or a bank account fraudulently
opened in your name. This action will alert merchants
who may be presented with the fraudulent checks.
·
1. CheckRite: (800) 766-2748
2. Equifax Check Systems: (800)
437-5120
3. Scan: (800) 262-7771
4. CrossCheck:(800) 654-4515
5. International Check Service:
(800) 526-5380
6. TeleCheck: (800) 710-9898
Additionally,
you may want to stop payment on any outstanding
checks. Cancel your checking and savings accounts
and obtain new account numbers. Choose a secret
password for your account (not your mother's maiden
name or birthday).
How
do I contact credit bureaus?
- Equifax
- www.equifax.com
To order your report, call: 800-685-1111 or
write: P.O. Box 740241, Atlanta, GA 30374-0241
To report fraud, call: 800-525-6285
and write: Fraud Department, P.O. Box 740241,
Atlanta, GA 30374-0241
Hearing impaired call 800-255-0056 and ask the
operator to call the Auto Disclosure Line at
800-685-1111 to request a copy of youportr re.
- Experian
- www.experian.com
To order your report, call: 888-EXPERIAN (397-3742)
or write: P.O. Box 2002, Allen TX 75013
To report fraud, call: 888-EXPERIAN
(397-3742) and write: Fraud Department, P.O.
Box 9530, Allen TX 75013
TDD: 800-972-0322
- Trans
Union - www.transunion.com
To order your report, call: 800-888-4213 or
write: P.O. Box 1000, Chester, PA 19022
To report fraud, call: 800-680-7289
and write: Fraud Victims Assistance Division,
P.O. Box 6790, Fullerton, CA 92634
TDD: 877-553-7803
THE
BASICS FOR PREVENTING IDENTITY THEFT
-
Review your consumer credit reports annually.
-
Shred and destroy unwanted documents that contain
personal information.
-
Guard your mail and trash from theft. Don’t
leave mail in your mailbox overnight or on weekends.
-
Don’t divulge personal information over
the phone, through the mail, or on the Internet
unless you initiated the contact and are sure
of the recipient.
-
Don’t use easily obtained numbers or information
as passwords. For example, avoid using date
of birth, last 4 digits of social security number,
mother’s maiden name, phone numbers, or
consecutive numbers.
- Don’t
record passwords on papers you carry with you;
memorize passwords.
For
more information on preventing Identity Theft,
refer to the following websites:
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