Study puts new face on ID theft

Strangers found to be a primary culprit, adding another dimension to a growing crime

By JOSEPH MENN
Los Angeles Times
Oct. 21, 2007
Source

Major identity thieves obtain the personal information they crave from retailers, financial companies and other businesses about half the time, a new study suggests, undercutting a common perception that potential victims should worry most about being scammed by people they know.

The federally funded study being released today paints a complex portrait of the signature crime of the digital age, one that has been the top consumer-fraud complaint to federal authorities for six consecutive years.

Of more than 500 offenders arrested by the U.S. Secret Service between 2000 and 2006, just 8 percent were related to or socially acquainted with victims whose sensitive data were used to write checks, take out loans or buy cars.

A criminal you don't know

"The role of strangers — that's different than what's been reported until now," said lead scientist Gary Gordon, of the year-old Center for Identity Management and Information Protection at Utica College in New York, which produced the report.

Previous analyses mainly were based on surveys of victims who knew how someone ended up pretending to be them. They often pointed to acquaintances. Federal Trade Commission officials have faulted such figures, saying most victims of online thefts and compromised businesses are unlikely to learn how their information was pried loose.

Technology as a tool

The best-known of the past studies have been publicized by the for-profit firm Javelin Strategy & Research, which has taken funding from Visa USA, Wells Fargo & Co. and others that benefit from electronic transactions.

In April, for example, the Pleasanton, Calif., company said consumer fears about data break-ins were overblown because "breaches only account for 3 percent of all known-cause ID fraud." Javelin has claimed that half of known offenders are family or friends, and this year it said that 40 percent of ID theft cases stem from lost or stolen wallets, credit cards and checks.

But the Utica College research shows that "non-technological means" such as mail stealing and Dumpster diving were used in about 20 percent of the ID theft crimes solved by the Secret Service. That's the same proportion driven by Internet scams such as e-mail hustles and computer hacking.

The most common tool for identity theft was a range of technology devices, a broad category that includes credit card encoders, computer printers and telephones. Devices were used 37 percent of the time.