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Stealing Another's Identity

Aug./Sept. 2002
Volume 10, Number 33

More than 500,000 people a year are victims of identity theft, according to the government. A thief may open a new credit card account using a victim's name, birth date and Social Security number. He then calls the card issuer, pretends to be the card owner, changes the address on the account, and runs up charges. Or he opens a bank account in the victim's name and writes bad checks. Experienced hackers use technology to invade corporate databases and download credit card numbers and other personal data. It is not difficult to obtain a name, address, date of birth, telephone number, Social Security number or mother's maiden name through the Internet. Government and businesses continue to search for ways to deter the crime of identity theft.

State Action

At least 45 states have laws addressing identity theft. In many instances, new legislation enhances existing laws. To strengthen its code, California requires businesses to stop using Social Security numbers for many types of IDs. Social Security numbers can no longer be printed on bank statements and other mailed documents. Under this law, citizens can freeze access to their credit reports, and credit bureaus must develop a personal identification numbering system so individuals can choose when to release information. Consumer requests can be submitted in writing or by phone, and credit bureau compliance is required within five business days of a request.

Hawaii makes identity theft a felony and deceptive use of a fictitious identity a misdemeanor. Illinois and Pennsylvania make a person convicted of identity theft civilly liable to the victim. Victims can recover court costs, attorney fees, and actual damages.

Nebraska's Personal Identity Defense Act amends provisions on deception and unauthorized use of a financial transaction device and provides penalties, civil recourse and restitution. A commission in New Jersey recommends changes in Department of Motor Vehicle customer service technology to improve security and reduce identity theft. Washington's law requires releasing information to identity theft victims and allows law enforcement to record fingerprints for identification in cases of identity theft. Alabama created the Consumer Identity Protection Act that provides for civil damages and actions to clear a victim's credit history. New Mexico created a theft of identity criminal offense and prescribes penalties.

Although "identity theft" is a relatively new term, states have had laws for many years that provide for certain types of fraud. They also have a variety of terms and categories for the crime of identity theft:

• Indiana-forgery, fraud and other deceptions
• Maine-theft by deception
• Massachusetts-false impersonation
• Missouri-theft and related offenses
• Nevada-issuance of check or draft with intent to defraud
• Texas-fraudulent use or possession of identifying information
• Wisconsin-misappropriation of personal identifying information

Federal Action

The Identity Theft and Assumption Act of 1998 (18 U.S.C. sect. 1028) strengthens federal criminal laws on identity theft and focuses on consumers as victims. It is a federal crime to knowingly use another person's identification to commit fraud. The act requires a centralized service for complaints and consumer education in the Federal Trade Commission. The FTC provides a toll-free telephone line, an identity theft complaint database and a consumer information Web page. The act contains penalties of up to 15 years in prison and a maximum fine of $250,000. It verifies that a person whose identity was stolen is an actual victim. Previously, only the credit grantors who incurred financial losses were considered victims. The U.S. Sentencing Commission has issued specific sentencing guidelines for identity theft; even a person with no prior criminal convictions could get a prison sentence of up to 16 months. The Justice Department acknowledges that identity theft is a crime of major significance, requiring prosecution, civil enforcement, consumer education and prevention.

Government efforts, at both the state and federal levels, to address identity theft call for a coordinated and comprehensive response. Deterring thieves requires sound legislation, the courts and law enforcement to apply the law, and the financial industry to secure consumers' personal information.

Selected Reference

Smith, Robert Ellis, ed. "Compilation of State and Federal Privacy Laws." Privacy Journal 2002, Providence, R.I., pp. 33-35.

Contacts for More Information

Rita Thaemert
NCSL-Denver
(303) 364-7700 ext.157
rita.thaemert@ncsl.org

U.S. Department of Justice
http://www.usdoj.gov/criminal/fraud/idtheft.html

U.S. Federal Trade Commission
http://www.consumer.gov/idtheft/