From October 1994 to October 1998, this same man mailed letters and made phone calls using the names
Rainbow International
,
Magic Numbers
and
Future Con-3 8
C H A P T E R 2
cepts to tell seniors they were part of a group that could participate in pooled lottery winnings upon payment of a processing fee. When individuals mailed checks to one of several mailboxes he maintained at commercial mail receiving companies, he used their signatures and created fictitious authorization forms to gather information, and again withdrew money from their checking accounts. In all, he stole more than $1.3 million. After a federal investigation resulted in a
14-count indictment
, the man pleaded guilty to mail fraud. The judge termed his activity “despicable,”
and sentenced him to 36 months in jail.
C H E W I N G T H E F I N G E R T I P S
Later, you’ll see how biometrics are becoming a tool for preventing ID theft.
Biometrics
is a group of technologies that identifies an individual by a physical attribute, such as the sound of his or her voice, eyes, face or even DNA. The majority of
biometric identification systems
in effect today make use of fingerprint recognition. So, if you’re trying to “erase”
your identity when confronted with a fingerprinting device, what do you do? You start chewing off your fingers. That’s what one ID thief tried.
In 2002, a Nigerian husband and wife team living in the suburbs of Philadelphia were accused of stealing hundreds of identities through their airport cleaning business. They purchased merchandise with bogus credit cards, and had those items delivered to about 50 empty houses.
They called themselves Adegboyega and Bolanle Joshuasville—which were made-up names. The man’s fingertip-chewing was intended to prevent authori-3 9
I T C A N H A P P E N T O Y O U … N O M A T T E R W H O Y O U A R E
ties from finding out their true identities when they faced a federal indictment for immigration violations.
Their real names: Olugbemiga Adegoke Olusajo and his wife, Bolanle Elizabeth Onikosi.
Financial crime is so rampant in Nigeria that the U.S.
Secret Service has opened an office in Lagos to work
with Nigerian authorities to head off burgeoning email computer fraud. There has been a pervasive
West African influence in the U.S.’s rampant growth
of identity theft—and a disproportionate number of
ID thieves are from Nigeria.
Another Nigerian man also living in the suburbs of Philadelphia took a job with the local Social Security office and ripped off numbers to use in an identity theft ring. After he took personal information from SSA computers, the man helped others open or assume credit card accounts. Of particular interest to the thief: the maiden names of cardholders’ mothers.
Many credit card firms use those maiden names as verification for telephone transactions. In Chapter 8, you’ll learn how to avoid using the age-old mother’s maiden name when asked for it. Just as Social Security numbers have become too commonplace as codes of access to personal information, a
mother’s
maiden name
has also become too commonplace as codes of access to the same information.
T H I E V E S A T W O R K
The close relationships we make at work—and the ones we don’t make—allow the workplace to be an-4 0
C H A P T E R 2
other vulnerable spot for potential identity theft victims.
Employers are experiencing an increase in all types
of security breaches, including theft of employees’
personal information. An ex-employee of a major
insurance company recently downloaded 60,000
personnel files and tried to sell them on the Internet
for $50 each. He faces 45 years in prison.
Some employees will post personnel information online because they are mad at their employer or a specific coworker. Others sell the information or steal it to get credit cards.
Employment information
is vulnerable today as the workplace expands to include remote locations.
People are working from their homes, cars, hotel rooms and so on. They’re dialing into their desktops remotely, using wireless connections and exposing their computers to hackers and interceptions every day.
Information becomes increasingly easy to steal. This
expanding workplace
makes it that much harder for companies to protect information. This is especially true when electronic payroll and Human Resources data can be assessed remotely.
Vendors can also be culprits. Employers that contract out their
payroll functions
to a third party increase the number of individuals who have access to personnel data. The good news is that vendors can implement privacy policies and procedures that would be
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too costly and onerous for employers. Consider some situations:
•
An employee in South Carolina’s Bureau for Child Support Enforcement was sentenced to probation for using a coworker’s identity to get utility service; •
Employees who worked for First USA Bank, MBNA America, Discover Card, Chase Manhattan Bank, Household Finance Corp. and American Express were charged by a federal grand jury with crimes ranging from bank fraud to em-bezzlement to credit card fraud that cost these banks at least $665,000; •
A temporary worker at St. Luke’s Hospital in Allentown, Pennsylvania rang up more than $3,000 in charges in another woman’s name after the worker stole the woman’s identity on a
hospital computer
; and •
Retirees and other former Department of Human Services workers in the state of Illinois were among the victims of an identity theft scam involving an ex-DHS
employee who filched the names and Social Security numbers of about 5,000
colleagues.
Bank employees
who are involved in identify theft typically steal directly from a customer’s account or sell private financial information, such as a person’s Social Security number, date of birth and credit card account numbers. It doesn’t matter which side of the table you are on—employee or customer—you are a target nonetheless.
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T H E F I N A N C I A L L Y W E A K
You don’t have to have a villa or drive a fancy car to be a target. The great majority of identity theft victims are from the
hard-working middle class
—the people who struggle to make ends meet, put their children through good schools, keep insurance and mortgages and bills paid up, stress over every dollar spent on superfluous items, and dream of a two-week vacation—even if it’s spent relaxing in the comforts of home.
With consumer debt at an all-time high, many people
carry large balances
on their credit cards, which makes it easier to overlook suspicious purchases.
If you’re not used to scrutinizing every nickel and
dime listed on your credit card statements—even if
you only pay the monthly minimum and don’t intend to pay off your debt anytime soon—you need
to change your habits. Otherwise, you won’t notice
that $200 outfit or $600 car stereo system added to
your list.
C R E D I T R E P A I R S C A M S
For two years, North Philadelphia’s Darryl Brown promised people he could get them a new car even if they had bad or no credit. But he was using stolen SSNs to obtain fraudulently automobile loans.
When federal prosecutors moved in, Brown quickly surrendered and helped prosecutors snatch 11 asso-4 3
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ciates in an identitytheft ring that trashed the credit records of 59 people and defrauded 11 car dealers in Pennsylvania and New Jersey of 80 vehicles worth $2.8 million. Brown didn’t get off so easily: He was sentenced to a 15-year no-parole prison term and was ordered to pay $1.2 million restitution to seven auto dealers, five insurance companies and six financial institutions that lost money on vehicles he helped his clients buy but that were seriously damaged or never recovered.
Be wary of credit repair outfits that guarantee to fix
your bad credit in a short while. With the growing
number of Americans going deeper and deeper into
consumer debt every year, credit repair scam companies have cropped up at record rates.
You’ll find a lot of discussion about credit bureaus, credit watch services and credit repair shops throughout this book. These establishments are involved in every part of ID theft—from perpetuating the problem to assisting in its solution. There are good and bad aspects to these companies…and you need to be able to
use these companies’ services
to your advantage while avoiding all the scams abound.
W A N N A B E C E L E B S A N D A T H L E T E S
The list of potential ID theft targets is long. Anyone can be victimized. Oprah Winfrey and Martha Stewart lost theirs to the same busboy. Robert De Niro had his swiped by a movie double. Tiger Woods had to
4 4
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go to court to get his back. And we’re not talking cars, wallets or golf clubs. We’re talking identities.
In a high-profile case, a high school dropout used
library computers, the Internet and cell phones to
collect personal information about more than half
of the world’s 400 richest people, using the list in
“Forbes” Magazine. Abraham Abdallah, a busboy
in a local restaurant in Brooklyn, New York, was
able to successfully obtain personal information such
as names, dates of birth, Social Security numbers,
phone numbers, and sometimes bank and brokerage account information by using the Internet and
other sources. While working as a busboy, Abdallah
stole credit card numbers of various customers and
then used those credit cards to order and purchase
a variety of items over the Internet.
And that was just the beginning. He stole money and products worth at least $100,000 but was aiming for millions before he was caught. Warren Buffet, Oprah Winfrey, Stephen Spielberg, Martha Stewart, Paul Allen, Michael Bloomberg and Ted Turner were among his victims—many of whom didn’t even know their accounts had been compromised (because they’re so rich and don’t control their money as closely as you and me).
When thieves swiped $5,000 worth of personal items from his luggage in early 2001, Anderson Cooper got over it quickly. The son of heiress Gloria Vanderbilt and now the co-anchor of CNN’s American Morn-ing, Cooper was too busy hosting ABC’s
The Mole 2
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to worry about losing clothing and a
laptop computer
. (Note: If you left your laptop on the Boston T, would you know what personal information was on it—exactly?) What Cooper didn’t realize was that the crooks had also taken at least two of his personal checks, allowing them to create phony checks and loot $25,000 from his bank account over a nine-month period.
If you’re not on top of your finances and live a busy
life, you’re more likely to miss money draining from
your account over a long period of time.
Cooper finally noticed checks being drawn from an account he rarely used. When he called his bank he discovered that about 26 fake checks had been passed, as well as dozens of fraudulent wire transfers of money. And because Cooper did not report the losses
within three months
, the bank repaid only about $3,000.
This book will teach you how to look closely at your
finances and pick up on clues that could indicate a
breach in your personal identity. No one can afford
to lose the money, time and effort it takes to restore
a good name, credit and probably a few bucks.
A man who ran up $81,000 in credit card bills in the name of an Atlanta Hawks basketball player also stole from TV, movie and rap-music star Will Smith. In
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another case, Ishman Walker led a million-dollar identity theft ring in Chicago. First he stole a Citibank account number in the names of Michael Jordan and his wife, Juanita. Then he tried to find someone who looked enough like Jordan to raid the former Bulls star’s fortune.
He didn’t get that far. Walker was further accused of draining the accounts of at least 30 other people of more than $1 million. How did he do it? He
bribed
workers in the secretary of state’s office
and at least four banks to obtain the IDs and financial information for his scam.
If you have teenage children involved in after-school
sports or club teams, be wary of coaches who ask
for too much information. In upstate New York, a
man was caught using two 18-years-olds’ identities to open a utility account and obtain Direct TV.
He also held a baseball scouting camp for wannabe
professional players (who all believed the camp was
for major-league baseball tryouts), and then took
their money…and their identities.
Doctors also have to worry about thieves in the system, as
physician identities
are accessible from sources such as state medical boards’ Web sites, local physician directories or even the Yellow Pages. Physician names, as well as copies of medical licenses and office addresses, also can be stolen from
hospital
personnel files
. Criminals use the documents to obtain Medicaid provider numbers, then inform the state
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Medicaid program that the physician has a new address where payment should be sent.
Criminals also steal names, Social Security numbers, or identification numbers of
Medicaid and Medicare beneficiaries
.