Identity Theft, Account Hacking & Reality

Recent publicity has been given to "identity theft" and computer hacking into customer data files and accounts. The IRS has also been under scrutiny for its efforts to privatize tax collections and the safety of taxpayer information. In my area of the world there are "identity theft prevention" firms advertising on the cable access channels, the classified sections of local newspapers, and on the Internet.

But, despite all the hype, identifty theft is a failry easy crime to prevent, track and prosecute.

Fewer Identity Theft Victims Are Cited in New U.S. Study

An estimated 3.6 million U.S. households -- or about three out of every 100 -- reported being victims of identity theft, according to a government study that counted misuse of someone else's cellphone, credit card or personal information.

The figures released yesterday by the Justice Department differ from findings of a previous government study that counted 9.3 million victims of the crime.

Of the 3.6 million victimized households, the study said, an estimated 1.7 million discovered unauthorized use of credit cards during the six-month period.

About 540,000 households said someone had misused personal information of a person in the home to open new accounts, get loans or commit other crimes. This is what the financial services industry more often defines as identity theft.

This is not to say identity theft does not need our attention, it's just that most of us are more likely to be mugged than ripped-off in this manner. If banks would exercise more security control over its trash (i.e. shredding its waste paper), retail firms would be more diligent in protecting customer data records, online vendors more diligent in enforcing/monitoring online security, and individuals would be more aware of how to prevent such crimes, then the risk would be even less than the 3 percent identity theft rate.

Countless Dens of Uncatchable Thieves

YOU'VE probably never met Sergey Kozerev, a former student at the State University of Technology and Design in St. Petersburg, Russia, but it's possible that he's mugged you.

In the online world, he operates under the pseudonym Zo0mer, according to American investigators, and he smugly hawks all manner of stolen consumer information alongside dozens of other peddlers at a Web site he helps manage.

"My prices are lowers then most of other vendors have and I will deliver them in real time," reads a typically fractured Zo0mer post.

At the same forum, another user, "tabbot," offers "any U.S. bank accounts" for sale.

"Balance from 3K and above: $40," he writes. "Regular brokerage accounts from 3K and above: $70."

Tabbot also offers full access to hacked accounts from credit unions. One, with a $31,000 balance, is being sold for $400. "I can try search specific info such as signature, ssn, dob, email access," tabbot writes. "Account with an extra info will be more expensive."

The online trade in stolen financial data is thriving. So the news last week that the United States Secret Service has been Hoovering up identity thieves, document forgers and other members of online "carding" sites — Web forums that have become outposts for peddling hacked account numbers, bank passwords and PIN numbers, as well as the viruses, scripts and phishing scams designed to steal them — seemed a coup.

But however deserving those caught in this most recent sweep might be (20 have been arrested across the United States and one in Britain over the last three months, the agency said), the fact remains that in the transnational, Internet-driven market for stolen financial and consumer data, some thieves are simply easier to nab than others.