Walnut Creek, California (PRWEB) January 31, 2013
The Identity Theft Council is warning of a troubling increase in the exploitation of payday lending loopholes by identity thieves. According to the Council, because many payday lenders don’t run credit checks with the three main consumer credit bureaus – Equifax, Experian, and Transunion – before granting credit, identity thieves are increasingly turning to these lenders to bypass the few security precautions available to consumers to protect themselves.“I would estimate that more than a third of the identity theft cases we’ve worked on in the last six months have involved payday lenders,” according to Neal O’Farrell, founder and Executive Director of the Identity Theft Council. “It’s a triple whammy for victims. Not only do they have to fight a potentially serious case of identity theft, one that can last for months and even years, they’re often also faced with endless harassment and intimidation from unscrupulous payday lenders who deliberately ignore consumer rights. And those same lenders often refuse to cooperate with the credit bureaus to remove fraudulent or incorrect information from the victim’s credit report.”
While consumers can use fraud alerts, credit monitoring, and security freezes to help protect themselves against the most serious types of identity theft, these tools are of little value if the thieves avoid the traditional lending routes and opt to apply for fraudulent payday loans instead.
In one recent case, according to Mr. O’Farrell, a victim of identity theft reported receiving more than 100 harassing calls from payday lenders over a 48-hour period. In a second case, the victim reported receiving harassing and threatening phone calls from the same payday lender more than 300 times over a three-week period.
It’s a national trend, according to Mr. O’Farrell “While we were working on a case on the west coast involving a group of more than 300 victims of payday-related identity theft, the media was reporting that thieves who had accessed the personal information of more than 300,000 victims of a data breach at a Florida university had taken that stolen information directly to the same payday lenders we were dealing with.”
The Council is working with a number of partners to find ways to close this lending and security loophole and provide better protection for consumers and victims.
In the meantime, the Council offers the following tips to prevent and respond to this type of identity theft:
About the Identity Theft Council
the Identity Theft Council (ITC) is an award-winning non-profit, grassroots organization that provides hands-on support for victims of identity theft, helps law enforcement provide a more coordinated response, and promotes identity theft education and awareness at a community level. The Council was founded by security expert Neal O’Farrell with the support of local law enforcement. For more information or to become involved in the Identity Theft Council, please visit: http://www.identitytheftcouncil.org/.
Neal OFarrell
neal_ofarrell@yahoo.com
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Morning Business Memo…
With the start of the tax filing season just around the corner, the IRS is on alert for rising cases of identity theft and tax fraud. Many taxpayers can become victims if they are not careful about protecting their personal information. In some cases, thieves grab W-2 forms and other financial documents from mailboxes.
"The problem is there's way too much information about us floating around out there," says Adam Levin, CEO of the security firm Identity Theft 9-1-1. He says thieves have posed as tax accountants: "They will take the take the name as a store front of a well-known tax preparation company set up shop for a few days." People go in to get their taxes done and then "all of a sudden the store disappears," along with taxpayers' personal information.
The IRS is well aware of the problem. "If you think you have been the victim of identity theft and your refund has been affected, contact the IRS," says spokesman Eric Smith. "We have a process for handling that." Levin says the number of cases of taxpayer identity theft report to his firm has soared 800 percent since 2008.
There are several ways taxpayers can become victims, he says. "One is that they attempt to file a return and it's blocked, or they are waiting for a refund and they find out it's been misdirected because somebody filed before they did using their Social Security number."
Consumers have also received notices from the IRS saying their income was unreported. That could happen if a thief is using their personal information in connection with employment.
One day after Apple's quarterly report disappointed investors, its big smart phone rival Samsung says its profit soared 76 percent. The Galaxy outsold the iPhone worldwide for the fourth straight quarter. But Samsung says today it expects earnings to decline during the current quarter because of seasonally low demand for consumer electronics. The company is also leaving its 2013 capital expenditure at the same level as last year at $21.5 billion, underlining uncertainty about the global economy and declining demand for personal computers. Samsung shares fell in overseas markets.
Microsoft says its quarterly earnings fell 4 percent despite a lift from its latest version of Windows. The results are the first to include Windows 8, the new operating system. Although Windows 8 sales haven't been as strong as investors hoped, revenue in Microsoft's Windows division rose 24 percent from the previous year.
Richard Davies Business Correspondent ABC NEWS Radio ABCNews.com twitter.com/daviesabc
Also ReadRELATED: Bachmann Courts Endorsement from Sheriff Joe Arpaio
"Discover alerted the sheriff about the problem and he has since canceled the card," reports the CBS affiliate in Phoenix. "He says if he finds out the people responsible were struggling, he may not press charges." Well, that's nice of him. Just last week, Arpaio sounded a lot harsher, as usual, when it came to the topic of amnesty and Obama's new immigration-reform policy, saying: "And where’s the fairness here? Why do you want to give amnesty to those people that came across our border illegally?" So, yeah, we're not even going to try and pretend to understand Arpaio's sliding scale of moral law-breaking.
Your child's full name and date of birth are all someone needs to steal their identity. To shed light on this form of identity theft, law enforcement professional and former fraud supervisor Robert Chappell, Jr., explores the crime in his new book, Child Identity Theft: What Every Parent Needs to Know. Although more than 500,000 children become victims of identity theft each year--half of them under age 6--Chappell says the threat is one that parents must educate themselves about so they can teach their children how to protect their identity.
U.S. News spoke with Chappell about how to detect if a child's identity has been compromised, creative ways identity thieves steal a child's personal information, and why children are often a better target than adults. Excerpts:
Why are so many children targeted by identity thieves?
A child has clean credit in the eyes of the credit-issuing industry. Within the three major credit bureaus, it is widely publicized that there is no date-of-birth verification, so children have credit they've never used before. Credit card lenders are more likely to give a card to someone with no credit history than bad credit history.
[Read: How to Spot the Warning Signs of Identity Theft.]
For those who want to abuse credit, a child is an easier target because children don't have the fail-safe mechanisms that adults do. For example, parents who have credit cards receive statements about every 30 days either in the mail or online. That means they're able to notice credit abuses more readily. If you're going to target someone, would you want to start with someone shortly after birth--whose identity you may be able to use until they're 18 years old--or would you want to target an adult, where you're more likely to get caught earlier? The earlier the criminals target children, the longer they can use and abuse that credit.
In your book, you say many cases of child identity theft go unreported because the thief is often a parent or relative of the victim. What makes it easier for people to target children in their inner circle and hide the theft?
They simply have access to information. It's easier for me to steal your identity if I already know your information. However, many times a parent's intention is to borrow information for what they see as the sake of child. For example, they steal their identity to have their utilities turned back on. But then many find themselves wrapped into a situation where they can not only pay their own credit bills but also their children's bills as well. That starts them down the path of ruining their child's credit. Then the problem escalates when parents start to rationalize things like, 'My kids benefit if I get the cable turned back on so they can watch cartoons,' and then it tends to snowball into luxury items.
You say in the book that the lack of a structured system that understands and institutes identity-theft protections is the primary reason foster children are especially vulnerable to identity theft. With foster care lacking a governing body on best practices, is that kind of overarching system even possible?
The president signed a national order last year that attempts to have foster children's credit checked when they turn 16, so if they had their identity stolen, they can use the next two years before they turn 18 to help mend their damaged credit. But that's not going to solve the problem.
What I see as the only fix is for foster-care systems to take ownership of the child; to care for the child's personal information as if the child were their own. The foster parents need to understand that you can't look at individuals anymore and say that an adult is worth more in the credit-issuing world than a child simply because the adult is earning the income. Both are identity-theft targets, but a child is a more lucrative target because of the fact thieves can hide their tracks longer than if they steal an adult's identity.
Another institution you mention in your book as contributing to the child identity-theft crisis is the school system. Are schools taking enough precautions to protect a student's personal information?
The school systems do a fantastic job of educating children, but they're not police officers, and I think it's incumbent upon law enforcement to educate teachers of their role in this process. For example, walk into a typical elementary school classroom and you'll see the children's names and their birthdays so that the classroom can celebrate them. You may see journals containing their name, address, and date of birth left out on their desks. There are a lot of things that have not been modernized that need to change. We need to make sure all of the school employees are trained and all of the classrooms are designed to protect the children's personal information.
What online safeguards can parents put in place for their child if they're trying to build a wall of defense for their email, Twitter, and Facebook accounts?
A lot of times when you first sign up [for a website], they want to know your date of birth. I would encourage for children to either to not give their true date of birth or to not give it at all, if possible--don't just write off that kind of information. You can also give away similar information in pictures, so kids should be careful of what they have on those sites.
What are some ways people steal a child's identity that most parents haven't heard of?
I have a chapter devoted to what's called "the lobby listener." Go to a doctor's office and you go up to reception and they'll ask for your child's name, date of birth, address, ailment of why they're there, and sometimes their Social Security number. If I'm sitting in the room and I see this happen, quite often what I do is I'll write down the information I hear and then walk up to the person and tell them how someone would be able to steal their child's identity with this information.
[Read: 6 Tips to Protect Yourself from Identity Theft.]
Record-keeping is also a big one. Whether you go to a school's lobby or a doctor's office, you walk in and probably see records behind the receptionist. If someone wants to break into an establishment, it's a great location and they don't even have to physically steal anything. All they have to do is break in, copy the information, and leave. Any place that keeps documents on children out in the open like that is a high-risk avenue for identity theft.
Naturally a lot of parents panic when they find out their child's identity has been stolen. In your book, you recommend while they work with the police, they should try to not to be "annoying" but persistent throughout the investigation. What are your suggestions on how to do that?
First off, be organized and be helpful. I suggest people create a journal, which is basically a record-keeping system of who you have contacted, what the conversation was, what their contact information was in case the police want to follow up, and the documents you receive need to be organized. Being well-organized will make the police think you can help them solve this crime. The more a parent can do to help the police put the puzzle pieces back together, the more successful the investigation is going to be.
[See 10 Warning Signs of Identity Theft.]
Parents also want to know what progress the police make--it helps a lot of them calm their nerves to know that the case is being taken seriously. They should talk to the investigator about when they can get updates--when they can expect that next phone call--not when they can expect the case will be solved.
How would you feel if your child's identity was stolen?
I would feel like I failed to educate them in some way. I'd feel like it was my fault.
Identity theft is such a big crime that it would not be wrong to call it a sin. It ruins the victim’s life form upside down. It occurs when a criminal gets illegal access to the victim’s personal data in order to get finance.
Identity theft is one of the most extensively mounting crimes in the world. The worst thing is that one may get victim of this crime even if he or she is extremely careful. Even a single mistake can lead you to damage of your credit. These criminals are really difficult to catch because they play with your identity.
There are million ways to get access to your personal data starting from your social security number to your credit card and your web databases. Similarly these thieves have billion tricks to steal your personal information. All of your personal information like your security numbers, your credit card number, your account number, telephone number and home address can be leaked out and if it does, it can be misused in many ways.
In many countries like
Internet is a blessing for all of us. But for some people it has been a curse. Hackers and Phishers know how to hack your passwords and get access to your credits on web. It is easier to play fraud on web than in real world. Sometimes they send you spam emails to trap you. These emails carry attractive packages for people. They direct you onto some new link and when you want to enter into that link, they will ask your personal information. Never be a fool to give away your information to these links. You will be entering your data right into their databases.
If you have received mailed in applications for "preapproved" credit cards, but you have thrown them in the bin without tearing up the enclosed materials, criminals may retrieve them from the garbage and activate them without your knowledge. (Some credit card companies, when sending credit cards, have adopted security measures that allow a card recipient to activate the card only from his or her home telephone number but this is not yet a universal practice.) Also, if your mail is delivered to a place where others have ready access to it, criminals can just cut off and redirect your mail to another location so that they will receive them.
In these cases, the criminal might change the billing address of you credit. The billing reports will be received on a new address which will keep you unaware of all the explosive activities being done by your credit card. You will get to know when it is too late for you to act against the criminal.
