nlike other, more conventional crimes, identity theft is difficult to prevent because it is most often done electronically, either on the Internet or credit card transactions. It is not a traditional crime, where police can deploy resources to an affected area to reduce the incidents of crime and disorder. This unconventional crime calls for unconventional prevention techniques. Instituting a local prevention campaign can reduce the problem and provide positive community relations for the proactive police department.
In order to have a successful campaign to prevent identity theft, valid information about the extent of the crime in the community, including current statistics on the specific type of identity theft, victims' age, gender, and economic standing, is necessary. This information is readily available to any law enforcement agency from the Federal Trade Commission (FTC) and can be sorted out for geographical areas, down to a zip code. A prevention campaign also must include information on the type of suspects (sole perpetrators, gangs, terrorists) and their method of operation. Finally, the agency must have an ongoing education program for both the public and the officers. This education program must include all current and relevant information on how identity theft occurs, what type of information the suspects are seeking to gain, what information citizens should be guarding, and what they should do if they suspect identity theft in order to minimize victimization. Specifically for the officer, the education must include evidentially items officers should be observing during regular suspect detentions for other offenses and when questioning possible identity theft suspects.
Statistics on identity theft are useful for law enforcement agencies in many ways and can determine trends in suspect methodology, victim thought processes, and consolidation of resources to combat identity theft. All law enforcement agency command officers and investigators involved in investigating identity theft should familiarize themselves with statistics in an attempt to stay ahead of identity theft offenders.
According to the FTC, identity theft has topped the list of consumer complaints filed for the fourth year in a row. The FTC began collecting consumer reports in the Identity Theft Data Clearinghouse on November 1, 1999. The following statistics provided for this report are for January 2003 through December 2003. The FTC received more than half a million consumer complaints (526,740) during calendar year 2003, up from 404,000 in 2002. Forty-two percent of all complaints received by the FTC related to identity theft. It should be noted that the FTC reports that not all identity theft is reported to the clearinghouse, and the number could be much more. The FTC clearinghouse receives around 3,640 calls per week on its hotline, and 511 complaints through the Internet.
The clearinghouse is a rich source of information for law enforcement. The FTC, in conjunction with the U.S. Secret Service and other government law enforcement agencies, mines the clearinghouse data to uncover significant patterns of identity theft activity, develops investigatory reports based on the data, and refers the reports to the appropriate criminal law enforcement officials for investigation and prosecution.
The FTC also shares the clearinghouse information with law enforcement agencies via the FTC's secure law enforcement Web site, Consumer Sentinel, at (www.consumer.gov/sentinel).
Misusing the Victim's Personally Identifying Information
The following statistics represents complaints received by the FTC Clearinghouse and indicate how victims report that the thieves have used the stolen identifying information. The 2003 data, summarized below, help provide a broad picture of the forms identity theft can take.
- Credit card fraud accounted for 33 percent of the victims' complaints in the Clearinghouse. Focused breakdown of this data indicates that 19 percent indicated that one or more new credit cards were opened in their name, and 12 percent indicated that unauthorized charges were made on an existing credit card.
- 21 percent of the victims reported that the identity thief obtained unauthorized telecommunications or utility equipment or services using their personal information.
- Bank fraud accounted for 17 percent of all victims reported through the clearinghouse. Eight percent of those reported fraudulent checks written on their existing account, 4 percent reported a new bank account opened using their personal information, and almost 5 percent reported unauthorized electronic transfers from their account.
- 11 percent of the victims reported that the thief used the identifying information to obtain employment.
- 6 percent reported that the identity thief obtained a loan in the victim's name. This includes 2.3 percent who complained that the thief obtained a personal, student, or business loan, 2 percent who reported auto loans or leases, and 1 percent who reported real estate loans.
- 8 percent of the victims reported that the identity thief obtained government benefits or forged or obtained government documents in their name; 2.3 percent of those reported the thief had obtained a driver's license in their name.
Age of Victims
Ninety percent of the victims reporting to the FTC provided their age. The largest number, 28 percent, were between 18 and 29 years of age. The next largest group, 25 percent, was between 30 and 39 years old, followed by consumers in their forties (21 percent). Only 13 percent of the victims were in their fifties, and 10 percent were age 60 or over.
Fifty-three percent of all the victims are between 18 and 39 years old. Although this age group is more inclined to use the Internet and thus more susceptible to identity theft through online transactions, it also means that law enforcement should focus the development of prevention information and efforts on this age group.
Also available in the FTC reports are geographical information and ranking of the states by number of victims. FTC reports that although the geographical distribution of identity theft complaints in the clearinghouse may be affected by regional variations, including consumer awareness of their resources and complaint program, the distribution of complaints was fairly consistent from 2001 to 2003.
The Time Variable
An important time variable is between first misuse of identity and initial discovery by victim. Approximately 59 percent of the victims who contacted the FTC Clearinghouse in 2002 reported both when their information was first misused and when they first discovered that they were victims of identity theft. Some victims experienced multiple instances of identity theft and discovered different misuses at different times.
Forty-eight percent of the victims reported discovering they were victims of identity theft less than one month after the thief first misused their information; 22 percent learned that they were victims of identity theft within six months of its first occurrence; and 15 percent were unaware of the initial misuse of their identity for more than two years.
This statistic shows a relative short delay between the commission of the crime and its discovery by victims in a good number of cases. For prevention purposes, the teaching of techniques to make this time even shorter will lessen the financial damage and perhaps even increase suspect identification opportunities.
Surprisingly, only 39 percent of the victims reporting to the FTC Clearinghouse indicated that they had already contacted a law enforcement agency and filed a police report. Thirty-one percent indicated that the police did take a report of their identity theft complaint. Nine percent indicated that although they contacted the police they did not get a police report, and 60 percent of the victims reporting to the FTC had not yet contacted the police.
The FACT Act (Public Law 108-15), effective December 2004, now requires local law enforcement agencies to provide police reports to victims of identity theft. The new federal law also makes it easier for consumers to check their credit reports and correct any erroneous information contained in those reports. It entitles consumers to obtain free credit reports once a year from each of the three national credit reporting agencies.
This is a major change to the previous law, under which a consumer receiving an adverse action notice only after denial of credit, denial or cancellation of insurance, or certain other developments could request the right to a free copy of his or her credit report so the individual can challenge any erroneous information in it. However, creditors often do not issue outright denials of credit but rather extend credit at higher rates, without notice to consumers. The newly enacted law requires notice to consumers if information in their credit report is negatively affecting the rates they are charged for credit. For large loans, such as mortgages, rate differences can translate into many thousands of dollars over the course of a loan.
Nearly 70 percent of the complaints received by the FTC Clearinghouse contained some information about the person who is suspected of committing the identity theft. Victims often learn names, address, or phone numbers used by the suspect from the creditors, collection agencies, or other entities involved in trying to collect the fraudulent charges or during the investigation of the crime. This information can help law enforcement agencies link seemingly unrelated complaints to common suspects.
Twenty-eight percent of the victims who contacted the FTC reported that they thought they knew how the thief obtained their personal information. Fifteen percent of those indicated that someone they knew personally had stolen and misused their identity. Another 13 percent of the victims reported an event or incident that they believed led to the identity theft. Victim Assistance: Prevention
As a proactive local police measure, reaching out to the targeted population with prevention information and assistance is a positive police-community action. Development of the information isnot difficult since there are several local and federal agencies that have excellent identity theft prevention and victim assistance programs. Two such resources are the Federal Trade Commission and the U.S. Postal Inspection Service. In developing the prevention information, it is important to provide these pointers:
- Protect mail by removing it from the mailbox as soon as possible, or purchase a locking mailbox.
- Shred or tear up any discarded paperwork containing financial or personal information.
- Carefully review financial and utility bills to ensure no unauthorized billing has occurred.
- If using a computer, install software that encrypts information you send by e-mail.
- Stop preapproved credit offers by calling all three credit bureau and opting out.
- Only provide personal information and identifiers to people you know will keep the information secure.
- Be aware of where your personal identification is kept, and who has access to it.
- Don't provide information in response to unsolicited offers by phone, mail, over the Internet, or in person.
- Do not use your social security number unless you have to.
- To minimize the amount of information an identity theft thief can steal, do not carry extra credit cards, your social security card, your birth certificate, or your passport in your wallet or purse, except when needed.
- Remove your name from the marketing lists of the three major credit reporting bureaus (Experian, Equifax, and Trans Union).
- Have your name and address removed from telephone books and reverse directories.
- Order your credit report once a year from each of the three major credit reporting bureaus to check for inaccuracies and fraud.
- Always take credit card receipts with you and don't throw them away in a public trashcan.
Victim Assistance: Procedure
As noted in the January 2005 issue of the Police Chief magazine, a number of police departments have not developed policies or procedures for working with victims of identify theft. Each department should have a procedure in place that will accomplish the following:
- Provide victims with the information they need to recover from and stop further instances of identity theft.
- Provide victims with the FTC's victim guidebook, called "When Bad Things Happen to Your Good Name," available for download and printing on the FTC's Web site, (www.consumer.gov/idtheft).
- Provide victims with the U.S. Postal Inspection Service pamphlet "Identity Theft," available on the U.S. Postal Inspection Service's Web site, (www.uspis.gov).
- Tell victims to contact the following agencies and organizations:
- The FTC, to file a report (note that this report is not intended to replace the law enforcement report)
- The three credit bureaus (Experian, Equifax, and Trans Union), to place a fraud alert on their credit reports
- Financial institutions, such as banks, credit card companies, and other financial institutions the victim has accounts with, to check for unusual activity on their accounts
- Utility companies (power, water, phone, cable television, and so on), to inform them that they may have been victims of identity theft, and to check for unusual activity to their accounts
- Social Security Administration Inspector General Fraud Hotline, if they believe their social security number may have been compromised (800-269-0271)
- Advise victims to keep a log or diary of everything they do or information they gather regarding this identity theft.
- Advise victims to keep a folder with records of all correspondence they send and receive.
- Give the victim a copy of the FTC Sample Affidavit. This affidavit can be filled out one time by the victim, then copied and sent out by the victim to all the financial institutions and companies that require it to prove they were victims of identity theft.
The Billings, Montana, Police Department realized that identity theft was becoming one of the most explosive crimes in the country and recognized the importance of educating the public and providing clear advice on protection. The department collated information from various federal and private organizations regarding identity theft and then made an information packet of their own. This packet contains four distinct and important areas of identity theft prevention and assistance:1
- An explanation of the scope and seriousness of identity theft and a list of common methods of identity theft
- A notification process acceptable to financial institutions, modeled after the FTC's ID Theft Affidavit
- A means to assist the victim with the notification process, which includes the name and telephone numbers of relevant agencies
- A proactive approach in the form of a synopsis of identity theft to catch the attention of potential victims
Identity theft suspects can be divided into two main categories: opportunists and organized. The opportunist suspects include everyday criminals such as purse snatchers, drug addicts, car thieves, and the like. They are called opportunists because identity theft is not their primary target crime. They will steal the property and then use personal information, credit cards, checks, and other information to either commit the crime of identity theft, or sell the information to primary identity theft perpetrators, or criminal organizations, including street gangs, narcotics traffickers, fraud rings, terrorists, and cyber criminals.
The COPS office, in a report on identity theft, classified identity theft suspects in four categories based on the commitment and motive.2 Their research found two dominant motives for identity theft: financial gain and concealment. These motives are then measured as to the suspect's commitment to the theft and to the extent to which the suspect is simply an opportunist. For example, professionals who seek out targets and create their own opportunities have a high level of commitment to identity theft. Offenders with low commitment take advantage of opportunities in which ID theft appears to solve an immediate problem. The COPS research used the following chart
to determine the type of suspect.
The NW3C has excellent materials on organized rings and terrorism links to identity theft. These materials can be requested from NW3C free of charge. One of the case studies conducted by the NW3C was on the Colorado Jammat Muhammad Commandos, Sector 5. This group was linked to several crimes, including homicides, arsons, and thefts. This group was conducting commando training in the mountains of Colorado. They were stockpiling weapons and explosives, conducting surveillance of targets, and operating a security company to gain access to government target buildings. One of the ways they financed this enterprise was through identity theft. They used bank accounts, used aliases, and laundered money.
The NW3C also has excellent materials on the opportunist criminals. One in particular exemplifies the idiosyncratic thinking of an average opportunist identity theft criminal. The thief agreed to an interview as part of a plea bargain, and she tells all. The thief talks about how she, while working as an apartment manager, would use personal information from her tenants to perpetrate identity theft. To reduce the likelihood of getting caught, she would only use information from former tenants. She would wait for a few months after the tenants had moved, then use or sell their personal information so that she would not be connected to the crime.
One of the most important ways to prevent identity theft is to educate police officers on the latest techniques to recognize during traffic stops and other detentions. Because of officers' knowledge and attention, there have been some excellent discoveries made during these detentions that resulted in arresting entire criminal rings involved in identity theft. The officers' initial observations during these detentions provided sufficient cause to continue their investigation and ultimately resulted in acquiring search warrants. To this end, the officers must be cognizant of the identity thief's tools of the trade. These tools include the following:
- Blank checks and credit cards
- Laminating machines
- Skimming devices, through which the user can swipe a credit card, much like an authentic ATM machine, to obtain legitimate information from the victim's credit card magnetic strip
- Laptop computers
- Color copying machines
Officers must also be cognizant of they type of crimes facilitated by identity theft, such as the following:
- Mail theft and mail fraud
- Narcotics violations
- Money laundering
- Weapons trafficking
- Computer crimes
- Wire fraud
Knowing these crimes are part of identity theft, officers can conduct more thorough preliminary investigations and ask questions of victims and suspects relating to identity theft.
Officers must also be trained to deal with minority victims of identity theft. These victims usually do not report the crime due to several factors. However, some of the reasons are as follows:
- Language barriers: officers must be trained to understand and consider language barriers and cultural differences when dealing with minority victims. How the culture perceives the police is important when contacting victims of crime. In many cultures, the police are distrusted and are dealt with suspicion.
- Victims feel an increased sense of alienation because they are in unfamiliar surroundings.
- Minority victims have an increased sense of violation.
- Often victims will feel betrayed by established members of the same group.
- Minority victims may be afraid of reprisals. Asian, Russian, and Latin gangs are heavily involved in identity theft.
Officers should receive additional training on the fundamentals in dealing with minority groups. It is important for officers to know that some cultures use surnames differently, and their method of calculating age differs from traditional methods common in the United States. Above all, officers need to have patience when dealing with minority groups by recognizing and coping with the differences.
Officers must also determine if the minority victim was the source of the information; statistics show that 68 percent of victims gave some part of their identity to an offender. Some of the known sources include apartment advertisers, immigration lawyers, and driving schools.
Prevention Is the Key
Although there is every reason to believe that identity theft will continue to grow, grassroots prevention efforts can greatly decrease the impact of this problem. By knowing the local statistical information and identifying the type of identity theft committed, the type of victim and the type of offender, law enforcement agencies can develop preventive and educational programs to help decrease this crime. ■
1Source: the Billings Police Department Crime Prevention Center. For more information, write to (firstname.lastname@example.org).
2U.S. Department of Justice, Office of Community Oriented Policing Services, "Identity Theft," no. 25 in the Problem-Oriented Guides for Police series, by Graeme R. Newman (Washington, D.C.: U.S. Government Printing Office, 2004).
There are many resources on prevention of identity theft. However, one of the best resources for law enforcement is the NW3C. They have several CDs that deal with identity theft investigations, prevention and training. The NW3C is a private, nonprofit organization funded by Congress to assist and train local law enforcement agencies in white collar and computer crimes. NW3C has several publications and other multimedia training tools available to any local law enforcement agency. NW3C provides some of the most relevant and comprehensive training in computer crimes round the nation. Their training is recognized among experts in the field, and the best part is that the training is free to law enforcement agencies. Agencies interested in obtaining this information or training should contact NW3C. To learn more about NW3C's support for law enforcement, call the NW3C Communications and Outreach office at 800-221-4424, extension 363, or visit (www.nw3c.org
The Federal Trade Commission is another excellent resource for law enforcement. They have many publications to assist police departments and victims of identity theft. Some of these publications can be used to help police agencies educate the public about identity theft during crime prevention meetings. Among the FTC resources is a CD-ROM containing information for identity theft victims. The CD-ROM is available in a blank sleeve on which police agencies can print their own logos and contact information. To learn more about FTC assistance for law enforcement, visit (www.consumer.gov/idtheft/law_investigate.html).
Other identity theft resources for law enforcement agencies and victims include the following:
Secret Service: (www.einformation.usss.gov)
Postal Inspectors: (www.usps.com/postalinspectors/)
Social Security Administration: (www.ssa.gov/pubs/idtheft.htm)
Federal Bureau of Investigation: (www.fbi.gov)
Selected Identity Theft Resources