Three charged in huge identity scam bust
Published: 26 Nov 2002 09:34 GMT
Calling it the largest such bust ever, the US Attorney in Manhattan and the FBI apprehended an alleged ring of identity thieves, accusing three men of stealing tens of thousands of credit reports.
The ring is alleged to have operated over a period of three years, suspected of pilfering credit reports from the three major commercial credit reporting agencies and using that information to siphon funds from bank accounts and make fraudulent purchases. Authorities have accounted for $2.7m (£1.7m) in losses so far.
At the centre of the scheme as outlined Monday by Justice Department and FBI officials is a help-desk employee of Teledata Communications (TCI), a company in Bay Shore, New York, that lets banks and other lenders access credit histories compiled by Equifax, Experian and TransUnion.
The TCI employee, Philip Cummings, stands accused of wire fraud and conspiracy in filching lenders' passwords and subscriber codes that let a network of identity thieves obtain tens of thousands of credit reports of more than 30,000 individuals.
TCI declined to comment.
The government has fingered two other defendants, Linus Baptiste and Hakeem Mohammed, in related cases.
"The defendants took advantage of an insider's access to sensitive information in much the same way that a gang of thieves might get the combination to the bank vault from an insider," Kevin Donovan, assistant director in charge of the FBI's New York field office, said in a statement. "But the potential windfall was probably far greater than the contents of a bank vault, and using 2lst century technology, they didn't even need a getaway car. Using the same technology, we determined what was done and who did it, proving that technology is a double-edged sword."
Experts on identity theft said the existence of such a ring was the natural by-product of the existing system of computerised credit information.
"This situation was a problem waiting to happen," said Linda Foley, executive director of the Identity Theft Resource Center in San Diego. "We know that there are many cases of computer breaches where information (is stolen) leading to identity theft."
Experts also blamed TCI and the credit agencies for their roles in the identity theft problem. "How much screening did (Cummings) go through before being hired for the help desk?" Foley said.
A Gartner analyst pointed out the problem of too many low-level employees having access to consumers' personal information.
"The fact that lower-tier employees, people who don't have as high a degree of accountability, have access to such information is a problem, and it's one we see on a regular basis," Gartner analyst Doug Barbin said.
Among the TCI clients whose passwords and subscribers codes the identity thieves used are Ford Motor Credit's Grand Rapids, Michigan, branch; Washington Mutual Bank in St. Augustine, Florida; Washington Mutual Finance in Crossville, Tennessee; Dollar Bank in Cleveland, Ohio; and Central Texas Energy Supply.
The Justice Department and FBI urged people who suspected they were victims of identity theft to contact the Federal Trade Commission at +1 (877) ID THEFT (+1 (877) 428-4338) or through the commission's Web site.
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