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“Identity” — it’s yours, keep it!

By Michael D. Wynn, CFE

After hearing a news report that claimed Detroit is No. 2 in identity fraud, I had to search for my copy of the 2007 ACFE (Association of Certified Fraud Examiners) Report To The Nation on Occupational Fraud & Abuse. The only problem, a report for 2007 had not been issued.

The ACFE report is based on actual complaints, which include identity fraud such as credit card, bank, phone and utilities fraud, filed with the FTC (Federal Trade Commission).

Although, the report does not include instances where consumers were not unaware of a theft, identity fraud accounted for 36 percent of the total 674,354 complaints submitted to the FTC in 2006, which was down from the 2005, complaints of 686,683 submitted which represented 37% of identity fraud.

However, the recent report that put Detroit at the top of another crime list was based on research that covered only actual and attempted frauds rather than consumer victim reports.

The information coming out of a company in San Diego called ID Analytics, Inc. provides fraud intelligence services to other businesses. The report that would lead people to believe that Identity Fraud is so heightened in Detroit, is really based on broadband competitor data, and not actual user statistics.

The information may provide some indicators that lager cities are at higher risk for identity theft, which is no mystery since the nation faces this big problem. However, some would argue the validity of this study.

ID Analytics Inc. will get over 70% of credit card companies to voluntarily submit data to them and they have a database of at least 500 million applications.

The company looked at credit applications in ten ZIP codes in Detroit that begin with ‘482’ which ranked Detroit number two when examined at a three-digit zip code level. The ten metropolitan areas with the highest identity fraud rates in comparison: New York, Detroit, Los Angeles, Little Rock, Ark., Greenville, Miss, Atlanta, Ga, Phoenix, Ariz., and Portland, Ore.

Also based on this non-victim report, Michigan was ranked eighth among the ten states with the highest rates of identity fraud in comparison: New York, California, Nevada, Arizona, Illinois, Hawaii, Oregon, Michigan, Washington, and Texas.

Based on ID Analytics report, the two types of identity fraud include: True-Name identity fraud which is when a real person’s name, address and other information are used improperly and Synthetic identity fraud, when someone fabricates personal information such as a name or social security number.

According to ID Analytics’ findings, identity theft that victimizes a specific consumer accounts for 10 to 15 percent of all identity fraud, while synthetic identity fraud—criminals using identities fabricated from real and false data—accounts for 85 to 90 percent of all identity fraud.

Stephen Coggeshall, chief technology officer for ID Analytics and author of the report said in a statement: “Previous research from other sources has had to rely on consumer victim reports, which are, by their nature, incomplete.” However, Coggshall also notes that because synthetic identity fraud doesn’t have a real person as a victim, it is difficult to verify and often isn’t included in studies.

Therefore, because ID Analytics’ research did include synthetic fraud cases and was not based solely on victim reports, its findings are more statistically valid.

I guess the question is do victims care about the politics behind arguing over a slight increase or decrease in the rating? Maybe. But I personally would like to keep on working hard to build a better solution to this problem and provide the right education about identity fraud to many.

Identity Theft dubbed by the FBI as the “crime of the century” refers to all types of crime in which someone wrongfully obtains and uses another person’s personal data in some way that involves fraud or deception, typically for economic gain.

Your identification is yours, and you should keep it. To minimize identity theft, you must take extra precautions with your mail, garbage and telephone information. Watch for suspicious activity around your house, especially door-to-door salespeople who say they represent local restaurants, home repair or investment companies.

I also caution you from giving any personal information. Do not disclose personal information to just anyone including people offering business deals, free credit repair, quotes, and home business. You should regularly review your statements and monitor the balances (bank, credit, etc.).

Buy a crosscut shredder and shred any documents that contain personal information.

Parents must be aware of policy. Sharing information such as a copy of a birth certificate and/or Social Security card in order for their children to participate in after school activities and sports could be dangerous.

Place fraud alert on your credit reports, banks and credit union system when necessary, do not carry yours or your child’s SSN in your wallet or purse.

Use a locked mailbox to send and receive all mail, parents should teach children not to give out personal information over the phone, and not to provide any personal information over the internet without your permission.

Although consumers can take some steps to deter thieves, they’re pretty much helpless against many of the ways their financial information can be stolen, such as:

– The bank employee who steals personal data and sells it to crime rings

– The restaurant server who uses a handheld device to copy information from a credit card’s magnetic strip

– The dumpster diver who rummages through sensitive financial information tossed out by businesses that don’t bother to use a shredder

– The hacker who breaks into poorly secured shopping or financial Web sites

– The predatory Debt Counselors that offers ‘free or low-cost’ help to employees, and later found to include hidden fees and surcharges, fraud, identity theft, embezzlement of funds, and false or misleading advertising

More important, these bad guys wouldn’t be in the business of stealing identities if it weren’t ridiculously easy to get phony credit, and your information.

For more information, please go to:

“No one can defeat us unless we first defeat ourselves.”

— Dwight D. Eisenhower

Michael D. Wynn can be contacted at (313) 592-3157, or by email or go to

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