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ID theft victims get little help

One of the systematic reasons for the current ID theft epidemic: rewards for the criminals are high, while the chance of prosecution can be alarmingly low. By Bob Sullivan.
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It happens almost every day. Someone calls Charles Rutherford’s small mobile phone shop in Minnesota’s Twin Cities area with an obviously stolen identity, and tries to buy a cell phone. At his own expense, Rutherford finds and warns the ID theft victim, and sometimes he can even build an iron-clad case against the criminal. But it doesn’t matter, and the crimes continue, because no one will arrest the thieves he’s caught.

Local police aren’t interested in pursuing suspects, Rutherford says, “even with the offender’s home address and phone number.”

His frustration highlights one of the systematic reasons for the current ID theft epidemic: rewards for the criminals are high, while the chance of prosecution can be alarmingly low.

As the owner of a local cell phone dealership, Rutherford is a prime target for identity thieves. Ordering a new, untraceable cell phone is often among the first tasks for criminals who have just obtained a stolen identity. Because the fraudulent orders come in so often, Rutherford often spots them easily now.

So last September, when someone identifying herself as Sheri Knudson ordered two cell phones, Rutherford smelled trouble right away. Knudson’s credit report indicated she was 27; but the buyer wanted two phones, including one for her 16-year-old daughter.

So he tracked down the real Sheri Knudson, who lives in a suburb of Minneapolis, and gave her the bad news. The victim was disappointed, but not shocked — one year earlier, her car had been burglarized and her purse stolen.

And thanks to the cell phone dealer, she thought police now had a solid lead on on the criminal.

Rutherford has no walk-in retail store, and won’t ship to P.O. boxes. So the fake Sheri Knudson had to supply a real shipping address with her order, which could be the criminal’s real address. It at least would be a drop-off location where investigators could arrange a sting, arresting whomever showed up to receive the phone.

Bureaucratic bungling
But instead of bagging a criminal, Knudson and Rutherford entered a world of bureaucracy.

In quick succession, Rutherford contacted the Minneapolis Police, where the suspect lives, and then the New Brighton Police, where his Twin Cities Wireless office is located. Meanwhile, Knudson called the Anoka County sheriff’s department, where she lives. Then Rutherford called a special fraud unit of the St. Paul Police Department. All said there was nothing they could do.

But they got yet another break two months later, when the same criminal made a second attempt to purchase phones through Rutherford’s company. This time, New Brighton Police came to the store and filled out a report, even taped a phone conversation Rutherford had with the imposter. But the investigation stalled there.

All the while, the real Knudson knew full well that someone had her name and her credit, and that someone was making repeated attempts to spend money in her name. And no one seemed interested in stopping it, even though it seemed likely that each agency knew the whereabouts and phone number of the criminal.

Knudsen ended up calling the alleged suspect herself, disguising her voice, just to hear what her imposter sounds like. For weeks, she considered stopping by her imposter’s house herself, but now thinks better of the idea. But she’s still waiting for some help from authorities.

“At least call these people and scare them so they’ll stop doing it,” she said. “Anything would have been better than nothing.”

‘There's nothing we can do'
The story both Knudson and Rutherford heard: You’re not out any money, so there’s nothing we can do. In fact, both say they were told by various law enforcement officials that no crime was committed because no stolen property was received.

That’s not true: Attempting to obtain credit in someone else’s name runs afoul of federal law, including the 1998 Identity Theft and Assumption Deterrence Act. In addition, Minnesota is one of 44 states that have passed identity theft laws. Minnesota’s statues states clearly that “A person who transfers, possesses, or uses an identity that is not the person’s own, with the intent to commit, aid, or abet any unlawful activity is guilty of identity theft.”

“They have stolen something, they’ve stolen my name,” Knudson said. “And they’re going to keep trying until they get something.”

Rutherford wasn’t finished in his quest for help. Next he wrote to his state attorney general’s office, and got no reply. So he sent an e-mail to the Social Security Administration. An official there responded quickly, but with a disheartening suggestion: Go to the press.

“In your shoes, I would start with a letter to the editor of the local newspaper to generate some public pressure,” the official wrote.

Following that advice, Rutherford contacted

“Everyone’s heard about identity theft prevention, but it doesn’t seem there is much identity theft prosecution,” he said. “I’ve called and e-mailed police departments and news agencies, hoping to gain support for these very personal crimes. I fear these criminals are getting the impression that there are no consequences for their actions.”

They can get away with it
That’s exactly the impression they’re getting, experts say. Reliable statistics on nationwide identity theft prosecutions are hard to come by, but clearly they amount to a tiny fraction of the crimes.

“This is the fastest growing crime today because the thieves know they can get away with it,” said Linda Foley, director of the Identity Theft Resource Center. “An ID thief who finds out they can keep getting away with it is going to keep doing it.”

Star Systems, which operates the largest network of bank ATM machines, just released a study claiming that 1 in 20 Americans say they have been the victim of identity theft during their lives.

Barbara Span, the company’s vice president of external affairs, estimates that nearly 12 million Americans have been victims, losing a total of $23 billion. But in the year 2000, the most recent year for which statistics are available, the FBI reported only 922 identity theft arrests. That same year, federal prosecutors filed 2,172 cases.

“If you talk to law enforcement and ask them why they aren’t they prosecuting, they will say they have limited resources,” Span said. “And they prosecute crimes that are easier to prove. Also, violent crimes tend to take priority.”

It only makes sense that police often give top priority to catching violent criminals before they can strike again, Foley said. But often, lack of attention to identity theft crimes isn’t just about priorities, she said: It’s also about misunderstanding the seriousness of the crime.

“To some, ID theft is an isolated crime. Some people think, ‘I’m not going to cry tears for you, you were just inconvenienced.’ They don’t understand the long term impact,” she said. And some law enforcement officials don’t realize how investigation of a single ID theft incident can lead to discovery of an extensive crime ring.

‘We should at least try'
But there are law enforcement agencies that “get it,” Foley said. At the top of the list, Foley said, is the multi-agency Identity Theft task force in Los Angeles, headed by Sgt. Bob Berardi. Ten agents from the L.A. County Sheriff’s office, the U.S. Postal Inspector, the Secret Service and the State Department of Consumer Affairs work exclusively on identity theft, cooperating to string together cases and track down criminals through cyberspace. Since its creation in 2000, the task force has handled 12,600 cases, 5,600 in the last year alone. Last year, it made 114 arrests and succeeded in 51 prosecutions.

“That doesn’t seem like a big number, but with 10 people on the task force that’s a busy crew for the year,” Berardi said. “But the most important number to me is last we helped out 1,010 victims.”

In Los Angeles, before the creation of the identity theft task force — and in many other parts of the country today — untrained officers with an old-fashioned view of identity theft would brush off victims, he said.

“In the past, since the victim was not responsible financially, they carved the victim out of the equation and said it was up to the finance companies to prosecute. And they don’t want to waste the money. So nothing happened. But the victim is still being impacted.”

While plenty of crimes still remain unsolved, at least L.A.-area victims know they have somewhere to turn, and they can speak with officers who understand the severity of the crime. Identity theft victims deserve to be taken seriously by law enforcement, no matter the size of the police agency, Berardi said.

“They don’t want to be ignored,” he said. “It can be a matter of resources, but the general public ... expects you are going to provide them a solution when this happens. And we should at least try.”

But that’s easier said than done, particularly for small police forces, and particularly for a crime as confusing to prosecute as identity theft. Often, it’s not even clear where the crime was committed. That led to massive confusion in Colorado last month, when a new state law designed to protect victims took effect. The law permits victims to quickly erase blemishes from their credit reports, but requires the filing of a police report. But a report in the Denver Post indicated many local police forces are refusing to fill out reports when victims call or visit the police station, because they believe the crime was committed wherever the criminal was — not where the victim lives. The case quickly turns into a hot potato among law enforcement agencies.

Neglected by the courts
And even when police do try, there’s hardly any guarantees that the wheels of justice will turn in favor of the victim. Detective Bill Sorter, who investigated the Sheri Knudson case in New Brighton, Minn. concedes that his work stalled because her crime is a low priority — not to him, but to the Minnesota court system. Police officers who undertake complicated identity theft prosecutions get buried under a mountain of paperwork, and often find their cases neglected by prosecutors or courts, he said.

Last year, Sorter handled the cases of two criminals who impersonated over 200 victims. The criminals will likely end up only “doing time served,” he said.

“These are very time-intensive cases. There were 200 victims and we had to call each and every one of those folks, we had to get them to file reports with their local police, then get all those reports,” he said.

In another case, one identity theft suspect he arrested in November hasn’t even been charged yet by the local district attorney. The suspect was released on bail 48 hours after arrest, and has been arrested twice more for identity theft since November. With only three detectives on staff, and mandates from city hall not to work overtime, it doesn’t make sense for Sorter to spend time on cases that won’t result in prosecutions.

“It’s a Catch-22 ... It’s extremely frustrating,” he said. “In our area it will take one of the judges or legislators to become a victim so we get stiffer penalties.”

And as for Knudson’s case, Sorter simply hasn’t had time yet set up an all-day stakeout of the alleged criminal’s home. And he said he however frustrating it might seem, he can’t just knock on the suspect’s door and harass her.

“I don’t have a legal right to go there and run them up the flagpole,” he said. “We’re stuck between a rock and a hard place.”

Volunteer training
But there is reason for optimism — law enforcement officials seem genuinely interested in training on the subject, said Judy Collins, director of Michigan State University’s ID Theft Partnerships in Prevention organization. Several state and local agencies regularly attend the various identity theft seminars offered by Michigan State’s School of Criminal Justice.

Officers from Berardi’s Los Angeles Task force have run dozens of training classes, too. Even Sorter said he’s running an identity theft class for local residents in the next two weeks. And Berardi will be one of hundreds of state and local police officers huddling in northern Connecticut next week at the annual Internet Crimes convention, where identity theft will be the main topic of keynote speaker Jim Doyle.

Doyle was co-founder of the New York City Police Department’s Computer Investigation and Technology Unit. His investigative work led to the arrest of perhaps the most notorious identity thief to date, New York City busboy Abraham Abdallah, who managed to steal the identities of luminaries like Steven Spielberg, Ross Perot, Warren Buffett Oprah Winfrey, and others. Now he is president of Internet Crimes Inc., which in addition to running the convention in Connecticut offers computer training classes for law enforcement officials. And he concedes law enforcement has a long way to go before getting a handle on identity theft.

“What has to happen is we have to use the same model we used to bring awareness for child predators on the Internet,” Doyle said. “Seven years ago ... people really started paying attention to children’s safety on the Internet, and to finding predators. Well, ID theft has been going strong for four years. This stuff is exploding, and we have to bring that same kind of attention to ID theft now.

“We really have to learn about inter-jurisdictional matters, and there is real need for communication among law enforcement,” he said. “Chiefs and administrators have to recognize that it there is a big problem, and review their policies ... because the first reaction often seems to be ‘It’s not in my jurisdiction.’ ”

Be a pest
And that’s why Rutherford’s story is so irksome to identity theft victim advocates like Foley. The store manager could provide police with a wealth of information that could stop a series of identity criminals in their tracks, before they victimize people. But no one seems to want to listen.

“What we need are more businesses to step up to the plate and recognize crime trends and try to get action taken,” she said. But if responsible business owners and victims have nowhere to turn, they won’t bother.

The only answer, Foley said, is to be a pest. Talk to the local chief of police, then the mayor, then get up during a public city council meeting and make a stink. The advice was echoed by the Social Security Administration official who corresponded with Rutherford and suggested he talk to the media.

“He needs to stand at a town meeting and say ‘I’m trying to prevent a crime and getting no help here. Is this town really a welcome mat here for criminals?’ ” Foley said. “That will get attention.”