On Feb. 26 the Federal Trade Commission (FTC) released its annual Consumer Sentinel Report.
This paper reports data collected by the agency in a variety of subject including identity theft. While this is not a statistical survey it does reflect trends found in other surveys and also provides insight into areas not yet explored or compiled together into one report.
Of all the identity theft complaints more than 43 percent were tax or wage related fraud, the highest ever reported. In fact complaints about government documents/benefits fraud increased 27 percentage points since 2010, with tax or wage related fraud accounting for the growth in this area.
Since the IRS does not forward case information with the FTC this percentage could be significantly higher. In the first nine months of 2012 the IRS detected 642,000 cases of identity theft, up from 242,000 in all of 2011. That does not include the 436,000 cases from 2012 of fraudulent claims using the SSN of Puerto Rican citizens. While there’s no way of knowing how many stolen ID claims aren’t detected, the Treasury Inspector General for tax Administration estimated in July that 1.5 million bogus returns claiming $5.2 billion in refunds are getting through a year.
Other types of identity theft fraud decreased a bit including credit card fraud, medical identity theft and criminal identity theft.
Identity theft and the military has often been overlooked by the media. While 18 percent of all complaints to the FTC involved identity theft, 37 percent of complaints by military members involved identity theft issues. In an affidavit in a Florida case, an FBI agent noted that military personnel serving in combat zones make attractive targets since they don’t have to file their 1040s until 180 days after they leave the combat zone, meaning the crooks can be reasonably sure they’ll get their refund claims in first.
“Unfortunately military personnel are in a “too-easy-to-victimize” demographic,” explained Jay Foley of the ID Theft Info Source. “Their SSNs are overexposed due to the nature of record keeping and were, until recently, on their military ID cards and dog tags.
“It’s a sad state of affairs when the individuals that have volunteered to protect our freedoms are the ones that are most targeted by scammers and thieves. Having worked on these types of cases with military members in combat zones and their families, I know the emotional distraction an identity theft case can cause. Our troops should not be concerned about bank accounts or tax refunds when they need to place their full attention on staying alive.”
The number of victims who notified the police is the lowest in three years. That in itself is problematic. Foley, who helped to get the law passed in California to allow victims access to information about fraudulent accounts, explained why getting a police report is essential.
“In any case of identity theft, whether it is credit card, wage, employment, benefit, tax or medical fraud, you need to file a police report and get a copy of that police report. Your federal rights only kick into play when you have a physical copy of a police report in hand. Most companies will assume you are not a victim without it.”
“The FTC report, when combined with the recently released Javelin Research survey – that reported the number of identity theft victims reached over 12.6 million in 2012 – is yet another confirmation of the inevitability of victimization,” said Adam Levin, chairman of Identity Theft 911.
“Human error, misplaced trust, individual over-sharing of information and countless data breaches impacting all segments of the business community and all levels of government have contributed to the depressing reality that it is literally impossible to prevent identity theft.”