ITRC’s 5th Annual Aftermath Study Released: An Analysis of Identity Theft Through the Victim’s Eyes

ITRC’s 5th Annual Aftermath Study Released: An Analysis of Identity Theft Through the Victim’s Eyes

SAN DIEGO, June 4 /PRNewswire/ — The Identity Theft Resource Center(R)(ITRC) today released an important report discussing the impact of identity theft victimization. Since 2003, the Identity Theft Resource Center has conducted annual victimization surveys to study the impact of identity theft crimes on its victims. Now in its fifth year, the report allows us to analyze the data, draw some conclusions, map trends and identify areas for further research. While ITRC reports the data in terms of percentages, it is critical that we remember those numbers represent people. These are people with lives that have been interrupted, altered, torn apart and/or changed.

According to several sources, The Aftermath is the only study of its kind. This study reflects only the experiences of confirmed identity theft victims who have worked with the ITRC, and is not a census or general population-based study. The questions asked ranged from the emotional impact this crime has had on their lives all the way through to their ability to recover their good
name. It includes the financial loss to the business community in goods andservices.

The Aftermath 2007 does not distinguish between those who are still being affected from those who are not. Thus, certain measures of victimization represent conservative estimates since the assessment was limited to the ending date of the study.

The following are highlights of The Aftermath 2007 study. An analysis of the entire study was done by two business analysts and a psychologist, with their comments included in the full report, which can be found on the ITRC website:

— Prevalence of Types of Identity Theft Crimes: Financial identity theft crimes were reported by 78% of the respondents, 2% reported criminal cases only, and 2% reported governmental issues only. The rest were combination cases: financial and criminal (7%), financial and governmental (9%), and a mixture of all three types (3%). (Tables 1A and 1B)

— Uses of victim information: More than one-half (57%) of the 2007 sample reported their personal information had been used to open a new line of credit in their name. 13% of all respondents noted their information was used for obtaining new cable and/or utility services. (Table 2) It should be noted, check fraud and debit card fraud are increasing. The ITRC continues to predict that criminals will turn to other types of identity theft when it becomes more difficult to open new lines of credit. This may indicate changes due to the sampling taken.

— Non-financial forms of identity theft: In 2007, 62% of respondents reported thieves had committed financial crimes that resulted in warrants being issued in the victim’s name — more than two-and-one-half times higher than in 2006. All areas of criminal identity theft combined with other issues increased between 2006 and 2007. It should be noted that identity thieves continued to obtain government assistance and benefits using the victim’s information.
(Table 4)

— Sources of Stolen Information: With a five-year history to study, it is clear that, according to the respondents, about one-third of cases were started by a person known to the victim. The next highest category of identity theft originated from a lost/stolen wallet or PDA. Scams have become more of a problem for victims in 2007 than in previous years. Identity theft due to mail theft and theft of information from a burglary of a car or home has dropped in the past few years. (Table 5)

— Moment of Discovery: In 2007, 82% of victims found out about the identity theft through an adverse action compared to 76% in 2006. Only 10% of respondents found out about the crime due to proactive measures taken by businesses and 8% saw something unusual on their credit report. 42% reported that they found out within the first three months of the crime. One analyst believes that people found out more quickly because of the more aggressive nature of collection efforts and the tightening of the credit market. (Table 8)

— Costs to Victim: Respondents in 2007 spent an average of $550 in out-of-pocket expenses for damage done to an existing account. In reference to new accounts, respondents spent an average of $1,865, compared to $1,342 in 2006.

— Cost to Business: In 2007, the average loss in goods and services to businesses, as reported by survey respondents, was $48,941 compared to $87,303 in 2006. Six individuals exceeded $100,000, with one in excess of $700,000. This study only includes respondents who contacted the ITRC in 2007 and is not necessarily indicative of a national business loss average.

— Victim Hours Repairing Damage: In The Aftermath 2007, victims reported spending an average of 116 hours repairing the damage done by identity theft to an existing account used or taken over by the thief. Answers also included 6,000 hours, 8,640 hours, and 5 years of time (outliers). In cases where a new account was created, respondents reported an average of 158 hours to clean up the mess with outliers of “endless” and “too many to count.”

— Extended involvement: In 2007, 70% of victims indicated that it took up to 12 months to clear issues of all misinformation, compared to 50% in 2006. A moderate amount of victims (12%) took one to two years. Unfortunately, some 19% indicated that it took two or more years to resolve their case. (Table 9)

— Response by Creditors, Utilities and Collection Agencies: As in previous years, credit issuers, utility companies and collection
agencies continue to rate poorly in their handling of identity theft victims.

— Inability to Clear Negative Records: Credit agencies, either by putting negative information back in records (31%) or not removing it in the first place (32%), topped the list of reasons for victims’ inability to clear their records. Other prominent responses include a Social Security Number tied to another person’s file (22%) and victims’ fraud alerts being ignored (19%). An increase was also seen in the sale of credit accounts even though the fraudulent account was cleared by the creditor and the inability to get proof even with a police report. (Table 11)

— Unexpected secondary effects: Victims reported a number of additional problems including: increases in insurance rates, current credit card interest rates and criminal records not being cleared. The inability to get credit resonated with the majority of respondents (64%). In addition, 53% have collection agencies still calling; 27% had credit cards cancelled (even though the accounts were being properly maintained); 18% said it affected their ability to get a job; and 14% reported tenancy issues. (Table 10)

— Relationship of Imposter to Victim: It is important to note that a large percentage of respondents seem to have been victimized by those who may have had easy access to personal identifying information including friends, family members, ex-spouses/significant other, or those in close contact with the victim, such as co-workers. (Table 7)

— Child Identity Theft: In 2007, 47% of this special case group reported that one, both or a step-parent was the thief. Another 12% reported that it was another family member. 18% said that the person had access to information but is not related and 24% did not know how the case first began. The age of the victim when the crime FIRST began varied

— with 18% it was under five years old. It should be noted that the crime may have been discovered years later.

— Victim Response to Family or Child Identity Theft: Throughout the five-year range, we have seen spikes in categories such as “family supports victim in trying to force responsibility on the thief.” Family support does appear to be increasing, yet some families are torn or still in denial or want the victim to drop the case. (Table 16)

— Emotional Impact: Few significant positive changes have occurred in the feelings of victims and in terms of reported victim symptomology. More than 49% of the respondents reported a stressed family life; 22% felt betrayed by unsupportive family members and friends; and 23% said their family didn’t understand. (Table 17) The strongest feelings expressed were rage or anger; betrayal; unprotected by police; personal financial fears; sense of powerlessness; sense they were grieving, annoyed, frustrated or exhausted; sleep disturbances; an inability to trust people; and the desire to give up and stop fighting the system.
Long-term emotional responses included suicidal; feeling captive; ready to give up; and felt that they have lost everything. (Table 18)

About the ITRC: Established in 1999, the ITRC is a nonprofit, grant and donation funded organization. The Identity Theft Resource Center has conducted a similar Aftermath study every year since 2003, noting changes in trends and patterns. In 2004, it was presented with the National Crime Victim’s Service Provider Award by the U.S. Department of Justice and Attorney
General. It is a well respected voice of identity theft victims and works collaboratively with other entities to battle this crime. In 2007, the ITRC was a national grant recipient from the Department of Justice’s Office of Justice Programs. The grant was awarded to four non-profit programs in the United States that provide direct assistance to victims of identity theft and
financial fraud. This award comes as a direct result of the President’s Task Force on Identity Theft, established in May of 2006.
This project was supported by Grant No. 2007-VF-GX-K038 awarded by the Office for Victims of Crime, Office of Justice Programs, U.S. Department of Justice. Points of view in this document are those of the ITRC and do not necessarily represent the official position or policies of the U.S. Department of Justice

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