Agence France Presse
WASHINGTON DC — John Harrison learned about identity theft the hard way.
The 42-year-old former US Army captain discovered in 2001 that someone obtained documents using his name and Social Security number and went on a four-month spree, charging some 260,000 dollars on credit in his name.
The thief opened more than 60 accounts in Harrison’s name, including credit cards and personal loans; wrote over 100 bad checks; rented a seaside time-share; and bought two trucks worth 85,000 dollars and a Harley Davidson motorcycle.
A suspect was arrested, convicted and sentenced to 41 months in prison. But that did not end the problems for Harrison. Although most businesses wrote off the bad debts, Harrison has been sued, hounded by bill collectors and had his military pension garnished.
He spent countless hours trying to restore his good credit rating, and the stress eventually cost him his job as a sales representative.
“I think I probably will have problems for years,” he said in a telephone interview. “I’ve been unemployed five months and I’m running out of time. I’ll make it through this, but I’m going to go through some more suffering before I get there.”
According to the US Federal Trade Commission, some 27.3 million Americans have been victims of identity theft in the past five years, including 9.9 million people in the past year alone.
The survey calculated that identity theft cost businesses and financial institutions some 48 billion dollars last year, with consumers losing five billion dollars.
The crime dates back to biblical times, when Jacob used a goatskin to trick his blind father into thinking he was his brother Esau, to obtain his birthright.
Most identity theft today is associated with financial crimes, but the FTC said 15 percent of victims reported that their identity was misused in nonfinancial ways, such as to obtain government documents or tax forms.
In some cases, identity theft has been linked to criminals or even terrorists trying to evade detection.
Experts say the Internet is not the largest source of identity theft and that most e-commerce transactions are secure, but that one risk is databases with credit card or other data that are vulnerable to hackers.
Activists on privacy and identity theft increasingly blame loose standards at financial institutions and credit reporting agencies, which collect data on customers and provide or sell this to prospective lenders or other businesses.
“Whenever someone opens up a new account, it’s standard practice for a bank or credit card company to furnish that information to a credit reporting agency. The banks can share this information among their affiliates … or sell it to an unlimited extent to joint marketing companies,” said Chris Hoofnagle of the Electronic Privacy Information Council.
“They can sell everything they can monetize, which means all information they receive.”
To illustrate the availability of sensitive data, the California-based Foundation for Taxpayer and Consumer Rights said it obtained on the Internet the Social Security numbers of CIA chief George Tenet and other top US officials for 26 dollars.
The finance and credit industries say it is too simplistic to blame them for a complex problem.
Stuart Pratt, president of the Consumer Data Industry Association, which represents credit bureaus, said identity theft can come from family members, roommates, thieves rummaging through home mailboxes or trash cans — and even from public records like land documents.
“Criminals are creative and find a lot of different means for identity theft,” Pratt said.
Pratt said the credit industry is taking steps to safeguard personal information and help victims ensure the accuracy of their credit reports.
But victims argue that bad credit information can be hard to shake off and can affect them in many ways.
Harrison said, for example, that he faces higher insurance costs as a result of bad credit reports, “because people who don’t have good credit are less likely to take care of their cars and homes.”
The emotional toll is often the hardest for victims to overcome, says Harrison, who now counsels others as a coordinator for the nonprofit Identity Theft Resource Center.
“There’s almost nothing I can do” for the stress, he said, adding that counseling others is “the only relief, as a victim, that I get.”
Franklin Mellott, a US Navy officer from California, said he nearly lost his national security clearance after his half-brother stole his identity, because of intelligence directives that limit access to classified data for people with big debts.
“Each time my half-brother committed identity theft using my information, he jeopardized my security clearance,” Mellott told a recent congressional hearing.