Report - Guardian

The LSE Identity Project Report: June 2005 99Commission, in 2002 4.6% of Americans encountered some form of identity theft. 255Indeed, one survey notes that one in six consumers are willing to buy privacy protectingproducts and services to prevent having their identities stolen, spending on average $75per year, representing $2.5 billion per year. 256In response, the US Government has developed laws to prevent and investigate identitytheft. Under these laws identity theft is defined as taking place when someone:“knowingly transfers, possesses or uses, without lawful authority, ameans of identification of another person with the intent to commit, orto aid or abet, or in connection with, any unlawful activity thatconstitutes a violation of federal law, or that constitutes a felony underany applicable state or local law.” 257Numerous states have also passed laws that provide assistance in recovery from identitytheft. 258The primary regulator in the US, the Federal Trade Commission (FTC), defines identitytheft as follows:“Identity theft occurs when someone uses your personal informationsuch as your name, Social Security number, credit card number orother identifying information, without your permission to commitfraud or other crimes.” 259The FTC recognizes the source of this crime as being wide and disparate. The FTCcontends that thieves get information from businesses through theft, hacking, or bribes;from individuals by rummaging through rubbish bins; from credit reporting agencies;skimming credit cards or theft of wallets; performing a ‘change of address’ on existingaccounts; and through scams by posing as legitimate businesses. 260The FTC separates victims of identity theft into three categories. The first is theftthrough the creation of “New Accounts & Other Frauds”. The second is the “Misuse ofExisting Credit Card or Credit Card Number”, and the last and least serious was the“Misuse of Existing non-Credit Card Account or Account Number”. 261 The greatestincidence of theft occurs through this last form of misuse of account information. ‘NewAccounts’ fraud only occurs to 1.5% of the population, though amounts to $32.9 billionin costs, while mis-use of accounts (both credit card and non-credit card) amounts to$14 billion, where the vast majority of this occurs through credit card fraud (67%). The255 Federal Trade Commission – Identity Theft Survey Report, September 2003, available athttp://www.ftc.gov/os/2003/09/synovatereport.pdf., page 7.256 Ibid.257 Identity Theft and Assumption Deterrence Act, enacted by Congress in October 1998 (and codified, in part, at 18U.S.C. §1028).258 Federal Trade Commission, Take Charge: Fighting Back Against Identity Theft, February 2005, available athttp://www.ftc.gov/bcp/conline/pubs/credit/idtheft.htm.259 http://www.consumer.gov/idtheft/.260 Understanding and Detecting Identity Theft, FTC, available athttp://www.consumer.gov/idtheft/understand&dectect_IDT.html261 Federal Trade Commission – Identity Theft Survey Report, September 2003, available athttp://www.ftc.gov/os/2003/09/synovatereport.pdf.