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Last Updated: Monday, 21 July, 2003, 19:49 GMT 20:49 UK
Identity theft explodes in US
More than seven million people in America have been the victim of identity theft, a report warns.

Research by IT consultancy Gartner Inc indicates identity theft - the use of someone else's personal details for financial gain - leapt 79% over the 12 months to June 2003.

With 3.4% of the US population now having fallen victim to the scam, Gartner warned that more than half the incidents involved not organised gangs or career criminals, but friends, colleagues and even relatives.

"Identity theft is not necessarily a hi-tech crime, and can just as easily damage the credit reputations of low-tech adults who don't spend any time on the internet," said Avivah Litan, vice president and research director for Gartner.

Even so, the FBI and consumer groups warned on Monday of a burgeoning scam involving fake e-mails purporting to come from e-commerce websites such as Paypal, part of the eBay online auction operation, and ISPs including EarthLink.

Many credit issuers don't recognize identity theft fraud for what it is... causing a disincentive to fix the problem with the urgency it requires
Avivah Litan
Gartner Inc
The scam tries to fool people into visiting a faked website, which asks for personal details - including credit card information - under the pretence of confirming that records are accurate.

Easy access

Identity theft is becoming a huge problem, both in the US and elsewhere.

Part of the problem, experts say, is that personal information is much more readily available than ever before, making it easy to get - for instance - credit cards and loans in someone else's name.

To some extent people can protect themselves, by being careful about what information they throw away, since searching through rubbish is a long-established technique for garnering the information needed for indentity theft.

But investigators also believe that institutions, particularly banks and government organisations, need to be more careful.

Credit card slips are only now beginning to obscure most of the 16-digit number, for instance, while the sheer volume of direct mail selling credit presents a huge risk, they warn.

"Many banks, credit card issuers, cell phone service providers and other enterprises that extend financial credit to consumers don't recognize most identity theft fraud for what it is," Mr Litan said, estimating the average chance of being caught at one in 700.

"Instead they mistakenly write it off as credit losses, causing a serious disconnect between the magnitude of identity theft that innocent consumers experience and the industry's proper recognition of the crime. This causes a disincentive to fix the problem with the urgency it requires."

And in the US, the fact that most organisations use individuals' nine-digit Social Security Numbers (SSNs) as an identifier, despite the fact that SSNs are often freely available on the internet and sold by many states to database companies, is seen as a key vulnerability.

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