IDENTITY THEFT

PART 3 - How Is Identity Stolen?
By Elaine Currie, BA (Hons)

Identity fraud (also commonly known as identity theft) in the UK costs the country an estimated £1.3 billion a year. A quarter of UK adults know someone who has been the victim of identity theft or have themselves suffered as a result of having their identity stolen and misused. Identity theft is a crime which exists both offline and on the Internet. The menace of identity theft is growing but a recent survey show that 33% of adults in the UK take no precautions to protect themselves against this crime.

In Parts 1 and 2 of this series we looked at the meaning of "identity" in the context of identity theft and at the different types of identity theft. In Part 3 of this series we will be looking at the methods by which the identity fraudster can commit identity theft.

How is Identity Stolen?

There are many ways in which the identity thief can obtain what he needs to commit identity theft. Sometimes this consists of documents which have been stolen or "found" by identity thieves. On other occasions all the identity fraudster needs is information, perhaps a PIN or a credit card expiry date.

Some identity theft is carried out by or with the assistance of "insiders" such as dishonest postal workers who intercept mail containing identifier documents or dishonest bank staff who have access to personal records. Some people find themselves victims of identity theft following a burglary or mugging where thieves have stolen personal documents. Most identity fraud involves credit cards. Some victims have their credit cards cloned by identity fraudsters during a purchasing transaction in a shop or restaurant. Some victims are tricked into disclosing account security details by hoax telephone calls or "phishing" emails. Some people have their details stolen over the Internet by keystroke logging hardware or software. Some people place identifier documents in their rubbish where it is comparatively safe and easy for the identity thief to retrieve those documents and use them to commit identity theft with no fear that the documents would be missed by their owner. People who forget to have their mail redirected when moving house risk having sensitive documents fall into the hands of identity fraudsters. A common form of identity fraud which is difficult to prevent is performed when you move house and the subsequent occupants run up debts in your name. When the debt collectors call they are told simply that you no longer live at that address. You are unlikely to find out that you have been a victim of identity theft until you apply for credit and are refused.

In England, Royal Mail statistics for 2003 show that incorrect addressing resulted in 193 million letters being delivered to an address where the recipient had "gone away". A large percentage of these letters contained enough information to enable a fraudster to commit identity theft.

A credit card account can easily be taken over if an identity thief gets hold of a credit card receipt with the card number, expiry date and owner's name. This information is sufficient for the thief to obtain goods which will be billed to the victim's credit card. Goods can be purchased by telephone, post and online with no need to produce the credit card or forge a signature; name, card number and expiry date are the only things needed. This is known as card not present fraud.

A further way identity thieves can take over a credit card account without actually stealing the card is by "skimming" the details from your credit card when you hand it over in a shop to make a purchase. Skimming means that your credit card details are read from the magnetic strip and used to clone a new card or, alternatively, the thief can use the details to commit card not present fraud.

A method of taking over an existing bank account does not involve the identity thief in access to any documents. This is where the identity thief telephones the victim and impersonates the victim's bank. Using a plausible story, such as checking security details because there have been suspect transactions on the account, the thief obtains PIN numbers, passwords etc.

On the Internet this type of account takeover fraud is performed by hackers who send scam emails containing viruses that can access account information through your computer. Internet identity fraudsters also obtain sensitive details through the sending of "phishing" emails which purport to be from your bank and ask you to update security details such as your PIN or password.

A simple computer related means of obtaining sensitive information is by the use of keystroke logging hardware. This involves a small piece of hardware being plugged in between your computer and your keyboard. The insignificant connecter can sit and record your keystrokes and the identity thief can download the information onto his own computer. Identity theft using keystroke logging hardware can only be performed if the identity thief has access to your computer, so you should be pretty safe at home but in an office environment or internet café, it is a real danger.

The contents of your wastepaper basket can be a treasure trove for the identity thief. Utility bills, insurance renewal reminders and even unsolicited mail can be used as "evidence" of identity by the fraudster. A credit card statements and a transaction receipt or two can provide a fraudster with sufficient information to use your credit card online or in telephone or postal transactions.

A method of identity assumption known as ghosting was made famous in the novel "Day of the Jackal" and involves assuming the identity of a deceased child who had been born at about the same time as the identity thief. Starting with just the birth certificate, the identity thief can build up a fully documented false identity. As the victim is deceased the fraudster runs no risk of coming into conflict with the victim's own activities or finding that he is impersonating a known criminal.

Case Study

In March 2004, Ms McDonald of Dumfries, Scotland, received a telephone call from a well-spoken man who claimed he was from her bank and was ringing to inform her that someone else was trying to use her bank card. The woman checked and discovered that her purse which contained the card had been stolen.

The caller reassured the woman by confirming her name and address (which, of course, he had obtained from her stolen purse). When the man said he needed her PIN to stop any further transactions, Ms McDonald provided the number. When she checked her account later Ms McDonald found that several hundred pounds had been withdrawn as soon as she had divulged her PIN to the fraudster.

Part four of this series looks at the ways you can protect yourself from identity fraud.

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By Elaine Currie
You may republish this article only in its
entirety and with this resource box intact

Elaine Currie provides ideas, help and resources
for anyone wanting to work at home
visit: http://www.Huntingvenus.com
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