By Robert F. Berardi, Sergeant, Los Angeles County Sheriff’s Department, Whittier, California
dentity crime is one of the fastest-growing crimes in the 21st century, requiring the creation of laws to protect citizens from acts of fraudulence. Identity crime is defined as “the illegal use of another’s personal information, such as credit card numbers, social security number, or driver’s license number, to commit fraud or other crimes.”1 This article outlines the response to the growing problem of identity crime in Los Angeles County, California.
California passed its original identity theft law in 1998, but it quickly became apparent that law enforcement agencies were not prepared for what they faced: the state legislature has since amended, modified, and strengthened the identity theft statute several times. Even today, many law enforcement practices that predated the law remain unchanged, practices that cannot meet the needs of the state’s identify theft law. One of the most common difficulties facing local law enforcement agencies is the jurisdiction of the case. Often, police departments refer cases to other agencies for investigation because the suspect or the victim does not live in their jurisdiction or it appears that the fraudulent transaction occurred in a distant location.
Resources for Enforcement
Attempting to address the problem of identity crime requires an effective enforcement arm in addition to legislation. To adequately address the increasing number of identity crimes, an agency must be in a position to commit sufficient resources. For many agencies, additional resources for enforcing such emerging crime issues have not been forthcoming. They find it much easier to refer the victim to larger metropolitan agencies, especially when it would cross several jurisdiction lines and would strain the daily operation of smaller agencies to appropriately investigate the case.
Although a larger metropolitan law enforcement agency may serve as a resource for other departments in handling cases crossing jurisdiction lines, the metropolitan department also has daily duties and faces its own challenges in maintaining a constant level of effective service. The Los Angeles County Sheriff’s Department (LASD) has felt this conflict since its formation in 1850 and has benefited and learned from each incident.
The most important lesson learned is that statistical information must be developed to identify the level of need: what is the extent of the identity theft problem, and how does this problem (along with the newly passed legislation) affect our constituents and the department’s current and future operation?
Based on available data, reported identity theft incidents in Los Angeles County skyrocketed from 645 incidents in 1999 to 2,119 incidents in 2000 (fig. 1). Over the course of one year, identity theft had become a measurable, significant problem. The LASD formed a pilot program called the Identity Theft Task Force to provide a coordinated and localized effort to handle these investigations. The pilot program was closely monitored to determine if the investment would be worth the effort.
Task Force Partnerships
The Identity Theft Task Force originally consisted of four full-time sheriff’s investigators and one sergeant. In addition to LASD personnel, the California Department of Motor Vehicles, the U.S. Secret Service, and the Office of the Inspector General for the Social Security Administration were vital components in combating identity crimes. These partnerships were important because of the specialization of each organization. The Department of Motor Vehicles maintains a database of every Californian issued an operator’s license or identification card. The Social Security Administration has the ability to certify social security numbers and records. The Secret Service was given federal investigative responsibility under the federal Identity Theft and Assumption Deterrence Act (Section 1028 of the U.S. Code), passed in 1998, and is allowed to reach into another state to continue an investigation or to help a victim in the reporting process when state agencies fail to assist.
A prosecution arm was also essential for the task force if the group was to demonstrate any degree of success. This group therefore included a prosecutor specifically tasked with prosecuting identity crime from the Los Angeles County District Attorney’s Office.
The task force became fully functional in 2000, the same year that the department documented 2,119 identity theft incidents. Eight law enforcement officers and one prosecutor worked to investigate 2,119 cases and service a department constituency of 10.2 million people, as identified by the 2000 federal census. The service area in Los Angeles County is 4,084 square miles, a bit larger than the states of Delaware and Rhode Island combined. Within it lie 88 independent cities. The LASD provides contracted law enforcement services to 40 cities, as well as the unincorporated areas of the county (fig. 2).
Investigators were quick to develop working relationships with their victims, credit card companies and issuing banks, computer companies, and delivery services. The task force had a small staffing allotment, so it was important to investigate the cases in such a manner that would eliminate the need to spend countless hours in court—the task force simply could not afford to tie themselves up in a court process.
Other challenges came in the form of managing the growing number of cases, raising public awareness, law enforcement training, and funding. The number of reported identity theft incidents was growing, and so was the caseload managed by each task force member. The department had to develop a system that would capture vital statistical information in order to justify the continuation of the task force as well as to answer questions concerning what the department knew about the problem and what it was prepared to do about it.
In order to maintain a clear focus on the scope of the identify theft problem and the resources required to address it, statistical gathering focused on the following dimensions.
Search Warrants: The number of search warrants prepared for evidentiary documents was almost half the number of those prepared for a suspect’s residence or other place the identity crime had occurred. Often, banking and lending communities would dismiss an allegation of identity theft after a victim’s losses or accounts were restored, which did not address the crime. This disturbing situation eventually led to engaging lawmakers in calling for legislative reform.
In the case of one credit card merchant, company losses in 2002 due to identity theft were reported as only 1 percent, but that was 1 percent of $1 billion, which amounts to $10 million. This credit card company adopted the position that if ten credit card applications were approved, and one turned out to be fraudulent, the company could live with the loss. Although this might be acceptable as a risk management position for a business, it is not acceptable to the victim of that fraud nor to the law enforcement officers who are attempting to obtain information about the defrauded account and solve a crime. California was forced to revisit the identity theft law to ensure that victims were entitled to a release of information from these institutions.
Another issue concerned denial of service of a search warrant for this information. Some institutions responded negatively when served with a search warrant. Investigators were informed that the warrant would have to be approved at a corporate office in some other state, or that the warrant was invalid because the corporate office acted only on warrants issued in its state of operation.
Ultimately, these nuanced arguments slowed the investigation of an incident, serving only to delay the suspect’s capture. Eventually, law enforcement and the banking/lending community worked together to resolve some of these issues. Although there is more work yet to be done, this relationship is stronger today than it was in previous years.
Arrests: This statistic gives investigators a sense of accomplishment. However, the number of arrests in an identity theft incident is relatively low compared with the number of victims identified in that case. Therefore, this number initially appears disappointing until one realizes that one identity thief can victimize many people. In most incidents, an investigator’s case actually begins when a suspect is arrested; evidence is then recovered that usually exposes more victims than was originally reported.
Case Filings: Recording the case filings allows closure of the incident and is probably the most important aspect of the investigation for a victim of an identity crime. However, with only one prosecutor assigned to the task force, it would be a nightmare if every case went to trial. This is why it is important to investigate every identity theft incident with diligence, to ensure that the findings of the investigation cannot be challenged. This tactic leaves only one option for a defendant: to plead guilty. The bottom line is that no investigative unit can afford to have their investigators spend all of their time in court; the resulting strain on the unit would eventually lead to exhaustion.
Losses: It is vital to maintain statistics on the dollar amount of losses due to identity crime both at the time of documentation and throughout an investigation. It is important to know the fiscal impact of identity crime on constituents as well as the personal impact on their good name and security. More important is the impact on the economy. Accurate statistics in these areas validate the need for national identity theft laws and investigative services and determine the level of attention required.
Recovery of Fraudulently Obtained Property: Keeping track of the amount of fraudulently obtained property recovered by law enforcement investigators during the investigation of an identity theft incident is important as well. Usually, this property is identified through credit card or e-commerce transactions, such as Internet purchases. Property usually consists of computers and peripherals, luxury vehicles, or other items of high monetary value.
Preventable Loss: The preventable-loss statistic measures the success of the task force. The LASD Identity Theft Task Force defines a preventable loss as the amount of fraudulently obtained credit available to the identity thief at the time of arrest. In other words, the unused credit on each of the fraudulent credit cards found in the thief’s possession is the preventable loss.
Number of Victims Identified: With the right tools and desire, an identity thief can victimize a large number of people. Most identity thieves do not limit their operation to one victim; rather, these thieves tend to victimize many people by stealing many identities. Considering that the average credit limit assigned to a new credit card is $5,000, identity thieves need to steal several cards to make the crime profitable to their operation.
Cases Cleared by Arrest: Besides recording the arrests made by an investigator, it is also important to record the total number of cases cleared by arrest by the task force. Just as the arrests made by investigators may appear low, the total number of cases closed by the task force may also seem small; however, the number of complaints cleared when an arrest is made should be high.
Cases Closed Not Workable: In case management of identity theft, there are some cases that are too old to work, and information such as the credit application or Internet Protocol (IP) address is not available. The merchants or providers absolved the debt, assumed the loss, and closed their files. In these situations the department usually closes the case as being unworkable.
Cases Documented: It is important to document the number of identity theft incidents reported to the agency. This figure is important for determining the scope of the problem, assessing investigative needs, and noticing any sign of relief from the problem.
Statistical Code Reporting: In an effort to properly allocate investigative resources to the problem, statistical codes were created to correspond with the elements of identity crime as defined by California’s identity theft law. In this management process, the following categories were used: credit, goods, and services; utilities and cellular phone service; and possession of or attempts to possess personal profile information (fig. 3).
The LASD modified its case assignment manual to include instructional information regarding the use and distribution of these codes. All of these statistics are reported on a monthly basis for a 12-month period in a given year and every year for the life of the program. These statistics also help the department to evaluate the need for maintaining the task force.
While other law enforcement agencies were searching to find ways to balance the need for identity theft investigations with their other responsibilities, the LASD task force marketed itself by diligently investigating identity crime. In fact, many other agencies referred victims to the LASD task force.
At that time the news media began to cover the issues associated with identity theft, as well as the difficulties in investigating these cases. Many citizens were turning to the media with their pleas for help, and the news coverage specifically of the LASD task force further advertised the county’s effort, which brought in even more cases.
Raising public awareness of identity crime became the department’s next clear step. Constituent group meetings were scheduled to discuss the problem; through these meetings, the department learned that the public had no real information about recognizing identity theft and its causes and effects, or developing prevention strategies. The responses were overwhelmingly positive. Businesses, banks, and lending institutions asked to be included in these meetings. The department was invited to give presentations in other states on the task force, as well as methods of investigation and prevention. As the department started to strengthen its role in identity theft investigation, so did the State of California. Legislators called on the department to testify at state hearings and to endorse amended legislation to improve the identity theft law.
In mid-2001, the department called for an evaluation of the task force pilot program. The statistical data, the productivity of the task force members, and the political atmosphere were compelling enough for the department to adopt the task force concept upon completion of the 2001 evaluation. The department budgeted funds for the necessary personnel for the operation as well as equipment, such as vehicles, computers, printers, and supplies.
In that same year, the State of California created an identity theft grant program. The LASD was awarded a grant along with four other agencies in California. The goals and objectives of the grant were similar to those established by the original LASD task force; however, under the terms of the state grant the sheriff’s department would inherit oversight responsibilities in two adjoining counties. Although the funding from the grant does not cover all of the costs, it does provide some financial relief for the department and, by budgeting wisely, provides the necessary support. The department has received grant funding now for seven years, and it augments the benefit of the grant by providing necessary personnel to continue the task force’s success.
Grant funds also support a 40-hour course in identity theft investigation, certified by the California Commission on Peace Officer Standards and Training. Training is important in the combat against identity crime. Before the implementation of such training, it was not surprising for officers to acknowledge that they did not have a thorough understanding of identity theft cases. Owing to their lack of knowledge about the offense, investigators would often turn away from identity theft investigations; however, once investigators ended their training session, their competence and confidence levels were greatly enhanced.
The training itself served as a great marketing tool for the task force. Investigators from smaller agencies were encouraged by learning the investigative techniques for identity crime cases. During this training, many were just learning of the support available from the LASD Identity Theft Task Force to assist in their investigations. This training effort enabled more departments to assist their constituents in this developing crime problem. Although the training was successful, challenges lay ahead.
Benefits of a Task Force
A smaller agency is sometimes forced to stop or even close an investigation because it simply cannot dedicate any more resources to targeting more suspects than were originally identified early in the investigation. The small department must allocate resources to focus on day-to-day duties that make them visible; therefore, most of these resources must be directed to patrolling. Investigative units may involve only three or four detectives, and in some cases they serve on a rotation period among the various department units. In other cases, detectives and patrol officers share the same function, and all are expected to investigate their own cases to completion. The challenge is that the investigative function often takes up much more time than answering calls for service. Investigations involve the preparation and execution of search and arrest warrants, the gathering and analysis of evidence, and ultimately countless hours in court.
Smaller agencies cannot afford to lose a member of their cadre for long periods of time, nor can they afford to lose other members of their staff for very long to an involved investigative process. For example, to safely execute a search warrant, at least six officers are needed for containment, execution, detainment, and search and recovery efforts. For some agencies, six officers can represent an entire shift, including supervision.
The primary benefit of joining a task force is relief, since that group focuses on a specific type of problem. Resources are internal, and participation allows the task force to absorb investigative responsibilities, in order to avoid straining the resources of any one particular agency. To join the task force, an agency must assign one of its members to the group; but what it gains far outweighs what it gives up.
In the case of the LASD Identity Theft Task Force, the goal is to investigate as many identity theft incidents as is physically possible. The membership is very diverse, making the collective knowledge of the task force a force multiplier. The success of the task force is due to the participants and the understanding that everyone is equal. Egos are not allowed because they create competition, animosity, and cliques within the group, all of which interfere with productivity.
Individualism has its place at certain moments of an investigation, but teamwork is required in those activities utilizing more than one participant. Each member of the task force can take the initiative to assist a peer in an investigation. This flexibility is extremely important in large investigations that must be broken down into smaller parts.
Just as the work is shared, success is shared as well. Although the sheriff’s department is the host, accolades are always directed to the task force and the agencies involved.
Memorandum of Understanding
The existing memorandum of understanding is an agreement between the LASD and the participating agencies. The highlights of the memorandum encourage coordination of investigative activity, assessment of training needs, minimizing financial loss while maximizing apprehension rates, and improvement of prosecution efforts.
The following protocols have also been established as an operational foundation for the task force:
- Creating case screening criteria based on solvability factors (delivery address, application information, and delivery services used, as well as IP addresses, evidentiary information, and age of the case)
- Assisting victims in the restoration of their good name and credit
- Using volunteers to make initial investigative contacts
- Encouraging law enforcement agencies with trained investigators to take investigative responsibility or join the task force
- Establishing a model that encourages the development of like units
- Providing identity theft awareness and prevention seminars
- Providing input for legislative reform
- Informing the media regarding trends
- Creating working relationships with banks, credit card companies, and lending institutions.
Strength in numbers gives the LASD an advantage in terms of resources and support for other law enforcement agencies. A metropolitan law enforcement agency can afford to assume risk in creating pilot programs; by contrast, a smaller agency may create too much risk by committing more resources and personnel to a long-term project than it can afford. These are key issues that hamper the ability of law enforcement to coordinate a unified response in combating identity crime.
Keys to Task Force Success
In a recent survey conducted with California’s neighbor states, it was determined that each state had an identity theft law and provided online prevention resources to constituents. However, these same states lacked both grant programs available to law enforcement and a coordinated law enforcement response to combat identity crime. In these other states, law enforcement agencies acted independently as they would in any other investigation.
In some instances, task forces were created, but they were short-lived. Inadequate or nonexistent funding resources made up part of the reason. In most cases, the lack of direction, interest, and participation led to a dissipated effort.
A successful effort receives support at all levels; its focus is on team building with a clear mission and a desire to succeed. Frequent team meetings open lines of communication that make stated goals, expectations, and commitment levels apparent. Cross-training of personnel gets all investigators on the same page. A successful operation is one where the leadership is clearly identified, and decisions on behalf of the task force are accepted by the leadership of participating agencies. Investigators assigned to the task force should not serve two masters—a common mistake of most task forces. If they do, the task force will eventually disband.
Law enforcement must remain optimistic in dealing with the identity theft issue. Securing funding will always be a concern unless there is some proven benefit that guarantees a return. Smaller agencies do have the ability to be successful and should seek to take risks, such as breaking away from traditional law enforcement efforts or operating with a vacancy to support a task force effort. The risk is worth it if it means better service to constituents.
A smaller agency also has the option to join an already existing task force rather than to create a new one. The experienced task force will help develop staff, maintain high levels of morale, and open doors to new opportunities that would not otherwise exist.
Research is the key to validating a need. Law enforcement must justify everything it does that diverges from the norm. Simply stating that there is a problem to be solved is not compelling enough. The LASD task force was successful because department leaders were able to recognize the problem of identity crime and anticipate its continued growth. From that point, a natural order took place, allowing for dedicated staffing, training, equipment, and funding.
In the last nine years, the subject of identity theft has been on every law enforcement agenda. Over the years, positive strides have been taken toward improving the quality of life for constituents, with the primary focus of protecting their good name. This effort could only be accomplished through leadership demonstrated by law enforcement, legislators, the media, the Federal Trade Commission, and privacy groups, who collaborated to raise awareness that identity theft is one of the fastest growing crimes in America.
The Task Force Today
To date, the LASD Identity Theft Task Force operates three investigative teams. Two teams serve the northern and southern portions of Los Angeles County. A third investigative body serves Ventura County, California. The task force has grown to number 36 staff members, making up the management, supervision, investigative, and professional staff cadre. Participating agencies include the U.S. Secret Service, the Federal Bureau of Investigation, the U.S. Immigration and Customs Enforcement Agency, the U.S. Postal Inspection Service, the Office of the Inspector General (Social Security Administration), the California Department of Motor Vehicles, the Los Angeles County District Attorney’s Office, the Ventura County District Attorney’s Office, the Glendale Police Department, and the Culver City Police Department.■
1“What Is Identity Crime?” www.idsafety.org/consumers/overview/.