If knowledge is power, knowledge of a person's identifying information is a power that can easily be abused by criminals who impersonate others to profit.
Identity theft and identity fraud are terms used to describe all types of crime in which someone wrongfully obtains and uses another person's personal data in some way that involves fraud or deception, typically for economic gain.
For example, an identity thief might rummage through the garbage and steal somebody's old tax records or credit reports, obtaining their Social Security number, bank account information, birth date, and other sensitive information in the process. Then, the crook could use this information to open credit cards or take out loans in someone else's name, with no intention of ever paying the money back. This is classic identity theft, and it lines the pockets of the thief while ruining the credit report of the victim.
The following is a summary of the crime of identity theft and related fraud, including relevant legislation and examples of the crime.
Identity Theft Laws
Identity theft laws in most states make it a crime to misuse another person's identifying information — whether personal or financial. Such data (including Social Security numbers, credit history, and banking PINs) is often acquired through:
- The offender's unlawful access to information from government and financial entities
- Lost or stolen mail, wallets and purses, identification, and credit or debit cards
Identity theft is one of the fastest-growing crimes in the nation, robbing its victims of time, money, and peace of mind. Identity thieves often use the Internet but also can obtain sensitive personal data from scams, database hacks, trash cans, and other unsecured locations.
The Identity Theft and Assumption Deterrence Act
Because of the rise of identity theft and its harmful consequences for victims of identity theft, Congress passed a law in 1998 making it a federal crime. Under the Identity Theft and Assumption Deterrence Act, it is a federal crime when a person "knowingly transfers or uses, without lawful authority, a means of identification of another person with the intent to commit, or to aid or abet, any unlawful activity that constitutes a violation of Federal law, or that constitutes a felony under any applicable State or local law."
The Theft Penalty Enhancement Act of 2004
This law was followed by the Theft Penalty Enhancement Act in 2004, which increased penalties for "aggravated" identity theft, requiring courts to impose additional sentences of two years for general offenses and five years for terrorism-related offenses.
The Identity Theft Enforcement and Restitution Act
In 2008, Congress passed the Identity Theft Enforcement and Restitution Act, which expanded the scope of prosecution and increased the amounts of restitution available for victims.
Who Prosecutes Identity Theft?
Several government agencies are involved in investigating and prosecuting identity theft crimes, including the:
- Federal Bureau of Investigation (FBI)
- Federal Trade Commission (FTC)
- Secret Service
- Postal Inspection Service
- Internal Revenue Service (IRS)
The FTC in particular helps to coordinate among other federal agencies and provides resources to law enforcement, consumers and businesses.
Despite the increased focus from federal agencies, the vast majority of these crimes are prosecuted by state and local agencies, according to their respective state laws. Possible charges would include theft by deception, fraud, or misuse of identification.
Unsuspecting Victims of Identity Theft
Unlike a robbery or burglary, identity theft often occurs without the victim's knowledge. Most identity theft victims only find out after they see strange charges on their credit card statements or when they apply for a loan. While prevention is always the best policy, sometimes personal information is exposed through security breaches at banks or companies with which the victims do business. Thus, identity theft can happen even to well-prepared consumers.
In one case of identity theft, the owner of an auto dealership in Springfield, MO, used his legitimate business as a means of obtaining customers' personal information. He used the information he gathered from people interested in car loans to collect nearly $800,000 in fraudulent loans.
Get Legal Help with Your Identity Fraud Case
Identity theft laws vary from state to state. Sometimes even federal laws can apply to identity theft scams. To understand the laws in your area and any potential criminal liability, contact an experienced criminal defense lawyer near you.