DATE: December 9, 2003
TO: Board of Supervisors
SUBJECT: Fighting Identity Theft
Identity theft is a devastating form of property theft that affects millions of Americans each year. Unfortunately, San Diego County has emerged as a national hotbed for identity theft activity. Today’s recommendations will strengthen existing resources and encourage strong partnerships and policies to reduce the rate of identity theft across San Diego County.
Chairman Greg Cox and District Attorney Bonnie Dumanis:
- Direct the CAO to create an Identity Theft Task Force in partnership with the District Attorney’s Office and request participation from the Sheriff’s Department, San Diego Police Department, community-based organizations and businesses to develop recommendations to combat identity theft.
- Direct the Chief Administrative Officer to examine current County procedures to ensure that personal and financial identifiers for County staff, clients and customers are safeguarded appropriately, printed on documents only when necessary, and that all files are disposed of properly when no longer used by the County.
- Allocate $25,000 from Community Projects budget (0261) to the Identity Theft Resource Center in coordination with the District Attorney’s office to provide community outreach and assistance to victims of identity theft.
- Direct the CAO to pursue grant funding to assist with a public education campaign on identity theft.
- Direct the CAO to work with businesses and retail organizations when appropriate to encourage the use of do-it-yourself credit card scanners in order to reduce the potential for identity theft, and to draft standards for public notification to consumers when security has been breached.
- Refer to the FY 2004-2005 budget the consideration of proposed funding for positions dedicated to the investigation and prosecution of identity theft cases in the District Attorney’s office contingent upon available funding from law enforcement sources.
- Direct the CAO to work with law enforcement and community-based organizations to pursue additional measures to safeguard individuals from identity theft as they become available.
- Direct the CAO to include in the 2004 Legislative Sponsorship Program support for legislation that would encourage credit issuers to adopt tougher fraud proof practices, encourage the State to adopt tougher penalties for individuals convicted of identity theft and work with federal and state legislators, the District Attorney and Sheriff in support of such legislation.
- Authorize the Chief Financial Officer to execute a grant agreement with the Identity Theft Resource Center establishing the terms for receipt of the funds described above.
- Find that the grant allocation described above has a public purpose.
The fiscal impact of the proposed recommendations is $25,000.
Identity theft is a form of property theft that affects millions of Americans each year. Unfortunately, San Diego County has emerged as a national hotbed for identity theft activity. According to studies conducted by Gartner Research in July of 2003 approximately 7 million people nationwide fell victim to identity theft in the previous 12 months. These studies also showed that the number of victims has more than tripled in the past three years and is expected to continue to increase exponentially.
Statistics show that nationwide, identity theft victims on average spend over 600 hours attempting to recover from this crime. Often the process of recovery takes years and many times fraudulent accounts and credit reports still remain unresolved. Meanwhile each case of identity theft can cost businesses and financial institutions from $40,000 to $92,000 for each occurrence.
What is Identity Theft?
Identity theft is the misuse of one’s personal and financial identifiers in order to commit other criminal activity or for financial gain. Common types of identity theft include credit card fraud, bank fraud, false identification fraud, and passport and visa fraud. Often cases of identity theft are closely related with other serious crimes such as narcotics and weapons trafficking, mail theft, organized crime, money laundering, immigration fraud and even terrorism.
Stealing a person’s identity is easier than you might think. We leave trace elements of our personal identity lying around us everyday. It is far too easy for criminals to gain access to this information. The most common ways to steal a person’s identity are mail theft, unscrupulous employees, Internet and computer fraud and the unethical use of public documents.
Examples of Identity Theft
Identity theft is an equal opportunity crime affecting all spectrums of the population. On July 10, 2003 the House Committee on Ways and Means Subcommittee on Social Security heard testimony on identity theft cases. The following case examples were cited in that testimony:
- A New York resident that died in the September 11 attacks on the World Trade Center had his identity stolen. Ten months after his death his widow was alerted to this identity theft when she received a phone call regarding her husband’s recent auto accident. After researching the incident she discovered that someone had assumed her husband’s identity and was living and working using his Social Security Number.
- Another woman, a Nebraska resident, discovered she was a victim of identity theft when she was arrested for writing bad checks over a four-year period. After clearing her name with the police she discovered that over $40,000 had been charged in her name. Once she discovered who had stolen her identity she was unable to sue the person in civil court because the statute of limitations had expired.
There are thousands of examples of identity theft locally and most people have either been a victim of identity theft or know someone who has been a victim.
Impact of Identity Theft on San Diego
Statistics from the San Diego County Sheriff’s Department show a definite rise in the rate of identity theft. In 1999 and 2000 only 265 reports of identity theft were made. In 2002, the number of cases jumped to 512. The statistics within the City of San Diego are even more staggering, with 1,862 cases reported in 2002 compared to 927 reports in 1999.
Identity theft not only affects victims’ lives, it also adversely impacts our local economy. The Federal Trade Commission’s January report found that last year identity theft cost business almost $48 billion nationwide. Victims of identity theft paid nearly $5 billion in out-of-pocket expenses last year attempting to recover from identity theft. The report also indicates that California is the state with the second highest rate of identity theft. San Diego County had the second highest rate of identity theft in the State, only 364 cases less than Los Angeles County that has a population over three times larger than San Diego.
There are several recommendations included in this item to help combat identity theft. While individuals are able to take certain steps to discourage the theft of their personal and financial identifiers, government at all levels as well as the business community must also take proactive steps to combat this growing crime and really make an impact. The formation of an Identity Theft Task Force can assist with information sharing and the generation of new or collaborative approaches to this crime.
Additional action the County can take is to partner with other agencies and the private sector to launch a public awareness campaign promoting steps that citizens and business can use to protect them from identity theft. Helpful tips to consumers and businesses would include advocating for more face-to-face contact between businesses and consumers, encouraging consumers to check their credit reports and scores often while also advocating that credit bureaus and agencies become active in reporting anomalies to consumers in a timely manner. The Identity Theft Resource Center is a local, non-profit organization that researches, analyzes and distributes information as well as serving as a resource and advisory center for consumers, victims, law enforcement, the business and financial sectors, legislators, media and governmental agencies. Approval of Community Project funding will provide crucial resources to allow for outreach countywide and increased awareness of the crime of identity theft.
Once the crime of identity theft occurs, there must be appropriate resources to address investigation and prosecution of cases. Recommendation Four provides direction to ensure that during FY2004-2005 budget discussions, the CAO works with the District Attorney to determine if sufficient ongoing law enforcement funds are available to fund vacant positions that would be dedicated to the investigation and prosecution of identity theft cases in the District Attorney’s office.
In addition, the District Attorney will seek to enlist the support of the California District Attorney's Association in an effort to revive legislation that will enhance penalties for individuals who have prior identity theft offenses.
The County of San Diego will also review current County procedures with respect to the handling of employee information, personal and financial identifiers in order to ensure that best practices are in place to prevent identity theft. Reviews will be conducted of all County procedures in order to ensure that personal information about clients and customers of the County are distributed only on a need to know basis, that secure personal information storage systems are in place with access only by appropriate staff, that personal information is disposed of in a manner where it is rendered unreadable and that County personnel are trained in the proper procedures regarding information distribution.
It is very obvious that government, individuals and businesses must work very closely together to combat the devastating impacts created when someone’s identity is stolen. Each partner has a piece of this solution in the form of prevention at the individual and business level, intervention and prosecution at the government level and good business practices in the private sector.
We urge your support!