IDENTITY THEFT
Fraud- intentional deception made for personal gain or to damage another individual. Fraud is a crime and a civil law violation. (1) Fraud affects individuals, businesses and the economy as a whole. Every year millions of dollars are lost due to activities of scammers using countless illegal techniques to achieve their goals. As hard as people work to make money and as difficult as it is to save it, the last thing they want to do is lose any of it through fraud. Financial fraud is the number one consumer complaint, and the biggest danger all the people face nowadays is identity theft, one of the most pervasive and insidious crimes. Identity theft occurs when someone assumes some or all of your identity to engage in criminal behavior.
The first case of identity theft is described in the Bible when Jacob covered his hands and neck with goat skin in order to trick his father into giving him a blessing of a firstborn, in order to acquire all the property and livestock his father owned. In early American history, identity theft was focused on voters’ registration and ballot stuffing. Then in1930’s, brought 21’st amendment to the United States Constitution brought the new law that repealed prohibition. Alcohol was legal again, but drinking age was determined by individual state, until 1984 when US Congress passed the National Minimum Drinking Age Act. Between these times worst crime committed was underage drinking using fake ID. Usage of assumed name and identification to commit serious fraud was still rarity. (2) Rapid increase of personal and financial information along with new technologies gave new live to an old crime and ID theft is now being called the crime of the 21’st century.
Identity theft can disrupt lives or even put people in jail for the crimes they never committed; in other words, the victim of identity theft can suffer adverse consequences if held accountable for the perpetrators actions. Identity thieves take personal information such as: full name, birth date, and full address, mother’s maiden name, SIN number, driver’s license number, passport number, signature and credit or debit card numbers without the victims’ permission. Stolen or reproduced information can be used to: access bank accounts or open new ones; transfer money from bank accounts; apply for loans, credit cards or other goods or services; make purchases; hide criminal activities; obtain passport or receive government benefits; and finally facilitate organized crime and terrorist activities. (3) There are cases when identity thieves may try to even sell your property and embezzle the money. Techniques of stealing someone’s identity range from unsophisticated such as: pickpocketing, dumpster diving, obituaries or mail theft to more elaborate schemes. Today’s technology, low cost availability of computers, mainly Internet, made the work of ID thieves extremely easy and facilitates those elaborate ones:
Skimming – swiping debit or credit cards through skimming machine that records the magnetic strip of the cars; requires involvement of a person that will also record the PIN number, usually dishonest clerk or waiter at the restaurant.
Spoofing – using e-mails pretending to be legitimate individual or business to deceive victim to take specific actions.
Phishing – commonly done through the Internet by sending out many e-mails to as many individuals as possible, pretending to be legitimate business, asking to go on-line and update personal information, change passwords; or e-mail proposals to individuals to assist in moving money out of a poor country. (Refer to Exhibit1 Sample of phishing e-mail.)
Hacking computer networks, systems and databases with no or poor security to obtain personal data, often in large quantities.
Advertising bogus job offers in order to accumulate applications typically disclosing names, home or e-mail addresses, and telephone numbers.
Browsing social networks in search for personal details, published by the users – people help thieves providing information without fear and imagination what can happen later. Facebook is a very good example of how to get as many information as we want to without breaking the law. (4)
The list of techniques for obtaining and exploiting personal information for identity theft is much longer. ID theft is one of the fastest growing crimes in North America and has already hit 1 in 6 Canadians. With downturn in economy, the situation is only getting worse and not only criminal but average people too, are now more desperate than ever. There are several types of identity theft:
- Financial identity theft – using another’s identity to obtain credit, goods and services
- Insurance identity theft – “new” type of ID theft; it presents specific problems for the victim that must be addressed independently from other types; tends to be a concern when being a victim of medical identity theft;
- Medical identity theft – using someone’s name, insurance information to obtain medical services or goods;
- Criminal identity theft - posing as another person when apprehended for a crime;
- Child identity theft – minor’s SIN number is used by another person, very often family member, for the imposter’s personal gain;
- Synthetic identity theft – taking parts of information from many victims and combining it into one fake ID of a person that doesn’t exist. (5)
There is no guaranteed method to know that somebody is exposed to fraud. Indicators or “red flags” listed below are signs that something is not correct and it’s time to take some actions.
- Monthly credit card statement doesn’t come in mail;
- Unfamiliar items on bank statements;
- Telephone calls or letters stating you have been approved or denied by creditor that you never applied to;
- Credit card statement with correct address but different name on it;
- No recollection of applying for credit card and receiving statement;
- Creditor or collection agency contacting you about unknown debt. (6)
Need is the mother of all inventions, and it actually works both ways. As new ways of prevention, detection and protection against identity theft are devised, the criminals are inventing new ways of stealing. Prevention is the best way to deal with this type of crime. Considering most of the people use various identifications and most of them use banking system, have driver’s permit or have a passport at least let’s educate ourselves and use imagination what may happen and what to expect after our identity is compromised. Ruined credit rating, financial loss, inability to secure future credit, sense of violation, stress and emotional hardship should be more than enough to think twice before releasing any detail of personal information to anyone. Take precautions:
Shred preapproved credit cards, cancelled cheques, bank statements and other documents before putting them into trash.
Avoid offers “too good to be true”.
Shield your hand entering PIN number, do not carry PIN number with you and don’t share it with anyone.
Be particularly wary of unsolicited e-mails, telephone calls or mail attempting to extract personal or financial details from you.
Familiarize yourself with billing cycles for your credit cards. Follow up with creditors if your bills don’t arrive on time.
Do not carry all your identity documents in your wallet or purse.
When changing address make sure to notify the post office and relevant institutions. (7)
It doesn’t cost anything to be prepared and adopt preventive habits but it can cost quite a lot being victim. In Canada, the Phone Busters national call centre received 7,629 identity theft complaints by Canadians in 2002. The total reported losses were more than 8.5 million dollars. In the first quarter of 2003, there were 2,250 complaints, which reported losses of more than 5.3 million dollars. In 2011 there were 17,002 victims and total reported loss was $13.2 million dollars. Also, two major credit bureaus, Equifax, and Trans Union say that they receive approximately 1400 -1800 Canadian identification thefts per month, the majority are from Ontario. (8) The U.S. Secret Service estimated in 1997 that of the 9,455 cases investigated, consumers lost more than $745 million due to identity theft. The 2003 FTC survey found that the total annual cost of identity theft to its victims was about $5 billion. (9) According to - 2006 ID Theft Survey Report, median value of goods and services obtained by thieves for new account and other frauds is $1350; for all categories of ID theft it was $500. When it comes to the cost of ID theft to victims, more than 50% incurred no out of pocket (lost wages, legal fees, fraudulent debts, postage, notarization) expenses, some victims admitted substantial out of pocket expenses, 10% reported $1200,- or more. (10)
By taking steps to better safeguard personal information, chances of becoming victim of ID theft are significantly reduced. It is impossible to escape the risk and in case of being targeted there are some actions that should be taken. Depending on circumstances victim might need to:
1. Cancel credit cards and get the new ones, ask credit company if any accounts have been tampered with or opened fraudulently in your name;
2. Advice the bank. Close compromised accounts and open new ones.
3. Create PIN new numbers.
4. Keep track of the steps that have been taken and expenses incurred to clear and re-establish credit rating.
5. Contact the two national credit bureaus and place fraud alert on your credit reports. The same time order copies of your credit reports.
6. Avoid “credit-repair” companies.
7. Report the incident to the police and also contact PhoneBusters – Canadian anti-fraud call center. (11)
It is worth to mention that prevention of identity theft is a shared responsibility between individuals and entities that have in their possession private and personal details provided by customers or patients. Privacy legislation requires putting systems in place to ensure individuals, clients or patients’ information is safe, secure, accurate, gathered with consent and not used beyond the stated purpose. The federal Personal Information Protection and Electronic Documents Act (PIPEDA) and equivalent legislation in British Columbia, Alberta and Quebec, apply to businesses collecting personal information and give individuals the right to see if everything is in order and the power to ask for corrections. The 10 Privacy Principles of PIPEDA form a significant portion of Canadian privacy legislation. These 10 privacy principles outline responsibilities that organizations subject to PIPEDA must follow. These principles are: 1. Accountability, 2. Identifying Purposes, 3. Consent, 4. Limiting Collection, 5. Limiting Use, Disclosure, and Retention, 6. Accuracy, 7. Safeguards,
8. Openness, 9. Individual Access, 10. Challenging Compliance (12)
In October of 2009, Bill – S4 was granted Royal Assent and as of January 8th, 2010 mentioned Bill became the law, making it illegal to possess another person’s identity information for criminal purposes. (13) The new law provides police and justice officials with vital new tools and powers to help better fight identity theft. Bill S-4 creates three new "core" identity theft offences targeting the early stages of identity-related crime, all subject to 5-year maximum prison sentences:
•Obtaining and possessing identity information with the intent to use the information deceptively, dishonestly or fraudulently in the commission of a crime;
•Trafficking in identity information, an offence that targets those who transfer or sell information to another person with knowledge of or recklessness as to the possible criminal use of the information;
•Unlawfully possessing or trafficking in government-issued identity documents that contain information of another person.
Additional amendments include:
•Complementing existing mail offences with two new offences of fraudulently redirecting or causing redirection of a person's mail and possessing a counterfeit Canada Post mail key;
•Creating complementary forgery offences such as trafficking in forged documents, or possessing forged documents with the intent to use them; and
•Clarifying that certain acts in relation to PIN numbers and the possession of skimming devices (used to extract and copy debit card information) are prohibited. It also grants courts the power to order ID thieves compensate victims for money stolen and reasonable expenses incurred to re-establish his or her identity. (14)
Canada's first support center to provide resources for victims of identity theft has opened in Vancouver. The Canadian Identity Theft Support Centre quietly opened an office downtown at the end of March this year. A public launch was planned for May, but organizers say the center has already received about a dozen calls to its toll-free number. As mentioned before the issue of identity theft is one of the fastest growing issues in Canada and victims across the country have nowhere to go once they become a victim. The Center assists individuals from start to end on how to regain control of their identity. A charitable organization primarily funded by the federal Justice Department, the support center is modeled on a similar U.S. organization based in San Diego, California. (15)
As a conclusion I’d like to refer to J. Stoddart Privacy Commissioner of Canada, identity theft is obviously a complex problem. There is no simple or single solution to it because ID theft has many root causes. It is clear that fighting ID theft will require actions on many fronts. (16) Government already made first important step when the new law came into force, now both organizations and individuals must do their part. There is still space and need for comprehensive framework that would address issues with regards to ID theft such as: stronger data protection rules, consumer protection plans or the most important in my opinion public education.
Exibit1 Sample of phishing e-mail received on my personal inbox
I need your urgent responds. My Dearest one, Hi, my name is Princess Alimah 25 years old originated from Sudan. I decide to contact you after my prayers; I really want to have a good relationship with you. My Late father Dr. J. Yak was the former Minister for SPLA Affairs and Special Adviser to President Saliva Kiir of South Sudan for Decentralization. My father Dr. J. Yak and my mother including other top Military officers and top government officials had been on board when the plane crashed on Friday May 02, 2008 due to evil act of the group rebels. Before his sudden death, he told me as his only daughter that he deposited two trunk boxes worth of 1.5 M EURO as family treasury Gold & Jewelries currently in a courier service security company-Burkina Faso as a consignment registered pieces of art works / gold , with my name as the next of kin. After his burial I ravelled down to Burkina Faso to clear the trunk boxes so that I can start a better life and take care of myself. On my arrival, the director of the security company whom I met in person told me that my late father's instruction to the company was that the boxes will be release to me only when I am married or present a trustee who will help me to uplift the boxes for any kind of investment overseas. That is why I said that, I need your urgent responds. I will be pleased to work with you as trusted person and see that the boxes are release to you from the deposited security company. I have the deposited certificate which the security company issued to my late father as the depositor of the said trunk boxes. Once the funds have been transferred to your nominated Bank account we shall then share it in the ratio of 55% for me, 45% for you. Should you be interested Please treat this matter with utmost Confidentiality and send me the following? Full names ; Age; Private phone number; Residential address; Your international passport; phone / ID CAR; Your Nationality
Thnx. Princess Alimah Yak NDEKE. Reply to ; princessramah@yahoo.fr
References: 1. http://en.wikipedia.org/w/index.php?title=Fraud&printable=yes
2. http://idtheft.about.com/od/identitytheft101/a/A-Brief-History-Of-Identity-Theft.htn?p=1
3. http://www.rcmp-grc.gc.ca/scams-fraudes/id-theft-vol-eng.htm
4. http://en.wikipedia.org/w/index.php?title=Identity_theft&printable=yes
5. http://idtheft.about.com/od/Basics/a/The-8-Types-Of_Identity_theft.htm?p=1
6. http://www.phonebusters.com/english/recognizeit_identitythe.html
7. http://priv.gc.ca/resource/fs-fi/02_05_d_10-_e.asp http://www.rcmp-grc.gc.ca/scams-fraudes/id-theft-vol-eng.htm http://financialplan.about.com/cs/fraud/a/ScamSchemes.htm http://phonebusters.com/english.stopit-thetips.htm 8. http://www.docu-shred.ca/Identity_Theft_Facts.pdf
Canadian Anti-Fraud Centre Annual Statistical Report 2011
9. http://popcenter.org/problems.identity_theft/1
10. 2006 Identity Theft Survey Report
11. http://www.rcmp-grc.gc.ca/scams-fraudes/id-theft-vol-eng.htm http://www.phonebusters.com/english/recognizeit_identitythe.html http://priv.gc.ca/resource/fs-fi/02_05_d_10-_e.asp
9. http://www.priv.gc.ca/information/pub/guide_idt_e.asp
12. http://www.privacysense.net/10-privacy-principles-of-pipeda/ http://www.privacysense.net/pipeda/ 13. http://www.rcmp-grc.gc.ca/scams-fraudes/id-theft-vol-eng.htm
12. http://www.justice.gc.ca/eng/news-nouv/nr-co/2010/doc-32471.html http://www.rcmp-grc.gc.ca/scams-fraudes/id-theft-vol-eng.htm 14. http://www.cbc.ca/news/canada/british-columbia/story/2012/04/12/bc-id-theft-support-centre.html
15. Remarks at the Privacy and Identity Theft conference organized by Freedom and Privacy Association, Vancouver, B.C. November 24, 2008; Addressed by Jennifer Stoddart Privacy Commissioner of Canada - Maintaining Trust in Commerce and Communication: What Will it Take?