Identity Theft Complaints Soar at Federal Agencies

Consumers who have discovered they are victims of identity theft are besieging federal agencies with complaints about fraudulent loans taken out in their names, misuse of their Social Security numbers, and falsified credit card accounts.

“The fear of identity theft has gripped the public as few consumer issues have,” Jodie Bernstein, director of the Federal Trade Commission’s Bureau of Consumer Protection told a Senate judiciary subcommittee hearing Wednesday.

She said the agency has received more than 20,000 calls in the eight months since it opened a toll-free hotline to provide counseling to consumers whose identifying information has been stolen. The calls are now coming in at a rate of more than 800 a week, about 500 complaints and 300 seeking advice. That is double the number logged just four months ago.

Social Security Inspector General Jim Huse also reported what he called “alarming statistics” about the increase in allegations his agency’s fraud hotline is receiving, most of them involving misuse of Social Security numbers.

The officials said the Internet is the prime reason complaints are climbing so quickly, both because it gives thieves easy access to personal information, and because it gives consumers a handy way to learn how to complain.

Sens. Jon Kyl (R-Ariz.), chairman of the subcommittee, and Dianne Feinstein (D-Calif.) have introduced a bill to cut down the chances of identity theft. Feinstein said in an interview Wednesday that she hopes Congress at least makes the sale of Social Security numbers illegal. She noted that there are at least 12 Web sites that sell the identification numbers, some for as little as $25.

“The Internet is making it very easy” to steal someone’s identity, Feinstein said. “Any thief with a computer can do it anonymously.”

Another witness at the hearing, Michelle Brown, a 29-year-old Californian, made it clear thieves don’t always need the Internet to create a false identity. She described how a bank official called her in January 1999 to ask about payment for her new $32,000 pickup truck, a truck she never bought.

She subsequently learned that an application she made for a rental property a year earlier had been stolen from her landlord’s desk. The perpetrator used Brown’s Social Security number to obtain more than $50,000 worth of goods and services--including $4,800 for liposuction--and to rent properties, open up telephone accounts and engage in drug trafficking.

Brown said she spent more than 500 hours trying to clear up her record, filing all sorts of affidavits and statements, notarizing documents, making thousands of phone calls to creditors and government authorities.

The thief was caught and is now serving time for the thefts. She even used Brown’s name when she was booked as an inmate, and later in letters she sent from prison. And last fall, Brown was held by Customs agents after returning from a foreign trip, because of the thief’s criminal record.

The Kyl-Feinstein bill would require credit card issuers to confirm any change of address with a cardholder within 10 days. The provision is designed to prevent a common method of identity theft: a criminal steals an individual’s credit card number, and then requests a change of address to obtain a duplicate card and keep the real cardholder from seeing any bills with inappropriate charges.

The trade commission’s hotline is (877) IDTHEFT; its Web site on the subject is https://www.consumer.gov/idtheft/. The Social Security fraud line is (800) 269-0271.