In all the hand wringing over identity theft I have never heard anything like the following idea. The whole problem revolves around the fact that obtaining credit in someone else's name is quick, easy, and more importantly, undetectable. Commonly the victim is never aware of the crime or only becomes aware in the rich fullness of time. If the person was notified at an official address each and every time someone applied for credit in their name a large part of the problem would disappear. Like it or not, through our Social Security Numbers the government has a way to uniquely match your identity to your address. In the spirit of which I offer the following proposal:
- Each time a person applies for credit the address provided is compared with their address officially on file with the federal government. If the addresses do not match either credit is not given or there is some suitable waiting period. If the addresses do match then credit can be given immediately. In every case a letter is sent to the official address including details of the transaction.
The beauty of this plan is that it does not have to even be based on SSN. It could be voluntary like the national Do Not Call List. I'd volunteer. Heck, I'd even pay a small fee. I bet this would not be necessary, however. I can see Visa, Mastercard, and their brethren cheerfully paying for it. If the federal government would provide a law that allowed the system to be created, funding it would surely be cheaper than the billions in fraud the credit industry writes off now as the price of doing business.
Posted by davew at May 21, 2004 07:10 AMIsn't this more or less the same as the Address Verification Service available for credit card fraud detection today?
http://www.echo-inc.com/faqs/index.php?ba=view_answer&cat_id=2&answer_id=71&name=Credit%20Cards
Is it the fact that it is a "trusted" third-party (the government) or that you'd make its use mandatory by merchants (unlike AVS, which leaves it up to the merchant to decide what to do on a failure)?
Posted by: Chris at May 21, 2004 11:48 PMI teach classes on Identity Theft Crimes to both law enforcement and the public. My tongue in cheek solution to prevent being a victim is to simply have lousy credit. Since that isn’t practical/desirable for most people, I instead offer the following preventative steps:
1.Check your credit report at least once a year. (This can be done for free or at minimal expense.)
2.Never put checks in the mail at home. Always use a drop box or the Post Office. (Postal Inspectors call that little red flag on the side the “steal me” flag because it lets crooks now there is something in the box.)
3.Save credit card receipts and check them against your monthly statement.
4.Don’t use your SSN for identification on either your checks or Driver’s License.
5.Shred ever personal document you discard, every credit card offer you decline, bank statements, billing statements, etc.
I’ve got lots more, but you get the idea. Paranoia is a good thing!
Lastly, I like the idea of a central clearing house for addresses. However, since I know bad guys have diverted mail with a change of address card that the victim didn’t find out about right away, it would take some serious work to be done right. Imagine if I change the mail for David Wiley but not Ellen Wilkin. Mail would continue to come to the house and you likely wouldn’t notice for a least a couple of days or weeks which is a lot of time for an ambitious crook!
Posted by: Scott at May 22, 2004 07:28 AMAs far as I know AVS is for transaction processing, I'm talking about credit applications. Also, I don't think the system will work unless the merchants are legally required to use the system and follow the guidelines.
Posted by: Dave Wiley at May 24, 2004 09:15 AMYikes! I am lazy and stick to only 3 methods:
1) Don't put SS# on checks (I did when I first moved here and didn't have a long-term residence -- I wanted to prevent the little parakeet looks I would get when I wrote a check -- wouldn't do it now -- don't even write checks very often any more).
2) Shred all personal papers that have identification numbers of any kind (credit apps, receipts, etc.)
3) Review my credit card statement and follow up on any company name that does not ring a bell or any charge amounts that look funky.
Hope it is enough!!
Posted by: ellen at June 4, 2004 05:51 PM