ID theft growing throughout Colorado

BOULDER — When Karen Hutton opened her Discover Card statement six months ago she was surprised to find numerous charges she didn’t recognize.

She was even more surprised when the Discover customer service representative told her the charges were made on the “courtesy checks” the credit card company regularly mails to customers.

“I never use those checks,´ said Hutton, who asked that her real name not be used. The Discover rep sent Hutton copies of the cashed checks as proof. Sure enough, they were Hutton’s checks but “They signed my husband’s name, but it didn’t look at all like his signature,” she said.

Hutton filed a police report. The detective said the use of stolen courtesy checks was very common in a ring of local identity thieves. What they would do is write a check for cash up to about $50 at gas station and put a fake Colorado driver’s license number on the check. Then one of the thieves would go to the clerk at a busy time, and the clerk would cash it while distracted with other customers.

The detective told her the checks probably were stolen out of the mailbox at her Boulder home.

‘Hassle factor’

In the end, Hutton said, she wasn’t held responsible for the charges, but the experience had a high “hassle factor.” She contacted her credit card companies to flag her cards for possible fraud and to ask them to not send any more courtesy checks. She notified the postmaster because the crime involved stealing mail. She called the credit bureaus — Equifax, Experian and

TransUnion — to report fraud theft reports and to flag her credit reports so if there was any unusual activity they would notify her.

“It’s wasn’t for a lot of money, but you feel like you’ve been violated,” Hutton said. “Someone knows about you.”

Unfortunately, Hutton’s story is common. In 2003, the U.S. Federal Trade Commission received more than 200,000 identity theft complaints from U.S. consumers, and reported consumer losses of more than $400 million. Colorado ranked No. 8 in the country for identity theft.

“(Identity theft) has been high in this state because we lacked a criminal sanction,´ said Cynthia Taylor, consumer affairs director for the Boulder District Attorney’s office. “I think that’s always the case with crooks — they will target areas that have fewer penalties than others.”

The laws are changing, however. Four new pieces of legislation that should discourage identity theft currently are going through the Colorado Legislature, Taylor said. House Bill 1274, which allows victims to collect damages for harm to their credit, passed both the House and Senate and is on its way to the governor; both House Bill 1134, which makes identity theft a felony, and House Bill 1122, which makes it easier for victims to request an investigation, are in the House appropriations committee and haven’t been schedule for a hearing yet; and House Bill 1311, which forbids the use of Social Security numbers on hunting and fishing licenses, passed in the House and is being considered by the Senate.

Although there are many techniques used by identity thieves, Taylor said the most prevalent today is “phishing” — deceiving consumers into disclosing credit card numbers, bank account information, Social Security numbers, passwords and so on — both on the Internet and over the phone.

On the Internet thieves create Web sites that are look-alikes for eBay or a bank and send an e-mail saying it’s important to go there to enter information that’s used to steal financial information, Taylor said. “People should just assume it’s not legit, and if they have any questions they should call the agency that it purports to be from.”

On the phone, Taylor said a thief might call and say, “This is Visa, and we want to verify that you just purchased a $26,000 ring.” When the consumer denies buying the jewelry the thief says,

“We’ll take it right off if you give us your credit card information.’ I think people need to be hanging onto their personal information very, very carefully,” Taylor said.

Fraud alerts

Jordana Beebe, spokeswoman for the Privacy Rights Clearinghouse, a nonprofit consumer education and advocacy program based in San Diego, said people who think they are victims of identity theft should first contact one of the credit bureaus — Experian, TransUnion or Equifax — to put a fraud alert on their credit report and to get a copy of it. It’s only necessary to alert one bureau because it will notify the others for you, Beebe said.

“If (a thief has your) Social Security number, it’s often used to establish new credit,” Beebe said. Fraudulent accounts will show up as credit accounts and credit inquiries you don’t recognize.

If there are fraudulent accounts ask the credit bureau to remove inquiries generated by fraudulent access. Then contact the creditors with whom your name has been used fraudulently.

A convenient way to do this is using the Federal Trade Commission’s uniform affidavit form, she said.

Victims can file a police report prior to notifying a credit bureau, but it’s probably better to wait until you know whether accounts have been opened, Beebe said. If you get a police report before you get the credit report, you’ll have to contact law enforcement again to amend the police report, she said. “We inform people to do that (second) because if they have to dispute those accounts it’s easier if you have a police report that with the fraudulent accounts on it.”

Beebe said one of the best preventatives is to get a credit report once a year. “Sometimes the first time you know you have been a victim is when you are contacted by a debt collector,” she said.

According to Phil West, detective lieutenant with Boulder County Sheriff’s office, most identity theft in Boulder County relates to methamphetamine labs or addicts. “It’s a very popular way for them to fund their activities,” he said.

Sheriff’s Deputy Russ Nanney agreed. “Meth addicts have lots of time on their hands and lots of energy,” he said. “They can sit and do all the meticulous work like taking a shredded document that they find in a Dumpster and piecing it back together.”

When caught, suspected identity thieves are charged with a felony crime, usually criminal impersonation, fraudulent use of a financial transaction device or check fraud, West said. “We pursue criminally, but it doesn’t do much to restore the person who’s been defrauded their reputation or credit.”

The sheriff’s office shares its information with law enforcement agencies countywide and nationally when needed, West said. “Those things balloon hugely and are frequently referred to other agencies. We may have a victim here, but the charges are taking place out of state. A lot of the transactions are done over the Internet, and much of them are investigated by the FBI.”

Contact Caron Schwartz Ellis at (303) 440-4950 or e-mail csellis@bcbr.com.

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