By Steve Lynch, Legal Assistance Attorney, Ninth Coast Guard District, Cleveland, Ohio
dentity criminals target every segment of society, including members of the U.S. Armed Services. The U.S. Coast Guard’s Ninth District in particular has not been immune from identity crime. Comprising more than 6,500 personnel, the district provides marine safety and security for the Great Lakes region through a network of cutters and units located in eight states. The district’s legal assistance attorney helps members and their families deal with a variety of legal problems, including identity crimes.
Like all military personnel, Ninth District personnel who are victims of identity crimes face special challenges. Many hold security clearances that require a clean financial history; someone who is a serious credit risk is often a serious security risk.
Identity criminals typically take as much as they can from victims, leaving a messy trail of fraudulent purchases and overdrawn accounts in their wake. If such a mess is discovered during a routine background check, Coast Guard members can have their clearances suspended until they can clear their credit trail. If their duties require an active clearance, they might no longer perform those duties until the clearance is restored. This is a serious threat to military readiness.
More challenges come for service members who are deployed. Many of the Ninth District’s personnel deploy to spots around the Great Lakes, and around the world, for months or even years at a time. This often makes it difficult or impossible for them to get real-time access to credit reports or even their mail—delaying the discovery of unauthorized transactions that are the hallmark of identity crime.
Deployments can also make it difficult for service members to get immediate help from law enforcement agencies or prosecutors. Few, if any, police departments or prosecutors’ offices will open an investigation without a personal appearance by the victim. So what are Ninth District personnel to do when, deployed on a cutter patrolling the Persian Gulf, they find themselves victims of identity crime? The answer for them is the same as it is for most military personnel, whether serving aboard ship or in the alleys of Baghdad: unfortunately, they have to wait or hope that loved ones or a legal assistance attorney can minimize the damage until they return home.
Need for a Prevention Program
In December 2002, the Ninth District learned firsthand just how much identity crime can have a negative impact on military readiness—if only as a serious distraction. Just before Christmas, criminals broke into the Phoenix headquarters of TriWest, the military health-care contractor for 16 states, and stole computer servers that contained social security numbers and confidential data about more than 500,000 active duty and retired military personnel and their dependents.
Members of the Ninth District stationed in Minnesota were among those affected; most did not have a clear idea of how to respond to the threat posed by the crime. They were so concerned that the legal assistance attorney traveled to Duluth to give them guidance on how to cope with this threat to their good names.
There was an immense turnout at the two assemblies, generating numerous questions from worried members and spouses. Most of their concerns were allayed. However, it became clear that the U.S. Armed Services in general, and the U.S. Coast Guard in particular, must do a better job of helping their personnel both reduce their risk of being victimized and properly respond if they become victims.
The resulting response from the Coast Guard was a two-pronged program: one prong provides personalized legal counseling for victims of identity crime, while the other educates personnel on preventing identity crime. This ongoing training began in 2003 and continues to this day. There are two parts of the training: an introductory briefing on the risks and remedies associated with identity crime and a specialized two-hour presentation on identity crime that is updated at least twice a year to address this everchanging “field of battle.” The slogan for both briefings is “Forewarned Is Forearmed.”
Identity Crime Briefings
The introductory briefing is a one-hour legal assistance training session that not only focuses on identity crime but also covers the full gamut of legal issues that military personnel and their families face. The briefings are given at Coast Guard installations and cutters around the Great Lakes and beyond.
In any one year, the number of briefings and attendees may vary. However, approximately 60 briefings have been given over the last five years, attended by perhaps 1,500 Coast Guard personnel. The briefings are supplemented with information contained on the Ninth District Legal Web site.1
The more specialized briefing focuses exclusively on identity crime, providing detailed practical guidance on how to guard against identity thieves and respond to theft. The longer briefing is typically reserved for personnel who have become victims, who have been subject to a data breach, or who are interested in the topic. This briefing was established as the result of national media coverage of the security breach at the Department of Veterans Affairs in the summer of 2006, which affected 26.5 million veterans.
The Ninth District is not the only organization concerned with protection from identity crime. The longer briefing is also given regularly as part of the Army Judge Advocate General’s military legal assistance course at Charlottesville, Virginia, and at the Coast Guard’s legal yeoman’s course at the Naval Justice School in Newport, Rhode Island. Military service organizations in Ohio have received the training as well.
Personnel are warned to watch out for both low-tech and high-tech scams. Low-tech crimes include the theft of personal data by dumpster diving or purse snatching. In some cases, the purse or wallet snatch occurs only after the snatcher or a partner has “shoulder surfed” or watched the victim type in an ATM personal identification number.
High-tech identity criminals use the Internet to “phish” for personal data by creating phony but authentic-looking Web sites, mirroring AOL or PayPal, for example. Victims visit these phony Web sites believing they are authentic, and identity criminals seek to steal data by urging victims to update or confirm account information, including social security numbers. A similar ruse involves using software programs to create false readouts on a telephone’s caller identification. Referred to as “spoofing,” unwary victims see what appears to be the name of a legitimate source, perhaps a financial institution, displayed on caller identification. Thinking that the thief on the phone is really a legitimate security officer, victims offer their confidential data.
Although these scams may seem obvious, many victims are young enlisted personnel away from home for the first time. Sadly, they are primed to be victims because they are smart, honest, and trusting but also inexperienced. The briefings remind personnel to be vigilant, including taking the following actions:
- Promptly remove mail from mailboxes, and never place mail in an unsecured box
- Purge wallets and purses of unnecessary credit cards and identification
- Keep receipts and other sensitive documents in a secure fireproof box or cabinet and shred them before disposal
- Report lost or stolen credit cards immediately
- Know the normal receipt times for financial statements, and contact the sender if not received on time
One of the best tools for detecting identity crime is also the cheapest: free annual credit reports obtained from each of the three credit-reporting agencies. Reports are available starting from the Federal Trade Commission (FTC) Web page.2
Another helpful tool for military personnel is the active duty alert. Under the Fair and Accurate Credit Transaction Act of 2003 (FACTA), military personnel can place the alert on their credit reports for up to a year. This warns potential lenders that the member is on active duty and that credit should not be extended without contacting the member directly. In many respects, the alert mirrors a security or credit freeze.
Despite the Coast Guard’s best efforts, every month or so, personnel or family members who are the victims of an identity crime contact the legal assistance attorney’s office. The range of culprits runs the gamut from anonymous scam artists to next of kin.
Clearly, the most difficult cases for clients arise when the identity criminal is a family member. Statistics show that about half of all crimes involving identity theft are committed by family members or ex–family members.
For example, in one case, a military member’s brother obtained a replacement driver’s license using the member’s name and license number but with the brother’s picture on the license. The brother used the license as identification when he was arrested. The arrest showed up on the member’s background check. However, the arrest occurred in another state several hundred miles away from where the member was stationed at the time.
In another case, a parent filed a fraudulent claim with the Social Security Administration, claiming to be the parent’s disabled adult child and therefore entitled to supplemental security income. The adult child was actually on active duty and expecting an income tax refund of several thousand dollars—a refund that never came. This member sought legal help when the Internal Revenue Service (IRS) notified him that his refund had been diverted to reimburse the federal government for the unauthorized payments to his criminal parent.
The legal assistance attorney’s office recommends that identity crime victims take six basic actions:
- Notify creditors and credit-reporting services immediately and demand the removal of false data
- Prepare and distribute a “Fraud Alert” and “Identity Theft Report,” both available through the Federal Trade Commission Web site (www.ftc.gov)
- Contact law enforcement and appropriate regulatory agencies, both state and federal
- Record and document all contacts with creditors, law enforcement agencies, and regulators
- Keep copies of all documentation either prepared or received by the victim
- Send all correspondence by certified mail return receipt
Sometimes the role of the legal assistance attorney is more active. The fiancée of one client, who was stationed in New York, stole his identity and used it to file a fraudulent tax return—receiving an unauthorized refund of several thousand dollars. The client contacted local law enforcement agencies in New York, and they initially told him to file a complaint in Illinois. When he spoke with an agency in Illinois, he was told to file in New York. He was given a similar runaround by the Internal Revenue Service (IRS). It took several months, but the IRS and local law enforcement agencies were finally persuaded to look into the matter. Fortunately, cases like this are rare.
A Growing Threat
It is undeniable that the threat from identity crimes will continue to grow as consumers, both military and civilian, increase their reliance on the Internet for banking and retail transactions. Despite this threat, as a result of the training program the Ninth District now has in place, it is hoped that fewer and fewer military personnel will fall victim to these crimes in the coming years.
At every training session over the last five years, attendees have been asked to raise their hands if they or their family members have been victimized by an identity crime. Invariably hands go up—sometimes a few, sometimes dozens. So far, there has not been a session where no one raised a hand, but the Ninth District looks forward to that day. It may never come, but if it does it will be a positive sign that the message of prevention is taking hold.
When it comes to the risk of identity crimes, as with other hazards in life, forewarned is forearmed. ■
1“Ninth District Legal: Newsletters,” U.S. Coast Guard, http://www.uscg.mil/d9/D9Legal/Newsletters.html (accessed April 14, 2008).
2“Facts for Consumers,” U.S. Federal Trade Commission, http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre34.shtm (accessed April 14, 2008).