Frank Abagnale on Identity Theft: Technology Breeds Crime

"If you make it easy for people to steal from you, it is unfortunate, but people will."

by / September 26, 2008

In a keynote speech given yesterday at the Government Technology Conference East, Frank Abagnale poignantly addressed many of the security issues that government, businesses and the individual are faced with today. Abagnale -- whose life was the subject of the movie "Catch Me if You Can" -- spent the early part of his life living on fake identities and stolen cash. Now, however, Abagnale now lectures on the potential risks involved in everyday transactions. Writing a check, using a debit card, making purchases online or even withdrawing cash from an ATM are all actions that can put the individual at risk. And while the times have changed and technology has advanced, Abagnale claims that much has remained the same in the world of identity theft and fraud.

Because of public access laws and the necessity of open information, gathering basic data on a given person -- living or dead, young or old, rich or poor - -- is, as he puts it, easy as counting to one, two, three. "If you make it easy for people to steal from you, it is unfortunate, but people will," said Abagnale.

Since April of 2007, there have been 15 million victims of identity theft. That's one victim every four seconds. According to Abagnale, identity theft "is a crime limited only by the criminal's imagination." A new type of identity theft has presented itself as recently as 2008. It's called "Synthetic Identity Theft." By using this type of theft, criminals can remain virtually undetected until it is far too late to catch them. The method used is as follows: A criminal obtains an individual's personal data -- name, date of birth, Social Security number, etc. -- and proceeds to open a credit card. But the criminal will purposefully change just one letter of the name or one digit of the Social Security number, knowing the credit bureaus have a "tolerance" feature built into their system which allows for human error when filling out applications. The credit card will be issued in the original individual's name, but under a secondary file. The criminal then has time to open more credit cards, build up credit, apply for a loan, default on the loan, and the individual is left to repair the damages.

Abagnale, citing various examples, said that people who steal personal information are not always hackers who use hi-tech devices and complex methods to break into an individual's computer. More often than not, personal information is right out in the open. Forms that are sent in the mail postcard-style will contain names, birthdates, and Social Security numbers. If not properly shredded, documents found in the garbage can easily be put back together in a few hours. Public records are just that: public. And there are a number of Web sites that will sell Social Security numbers for a very small fee (which is still completely legal, according to Abagnale). With so many ways for criminals to gather information, is it any surprise that identity theft is the fastest growing crime in the world?

"There is virtually no risk involved in identity theft. One in 700 thieves are caught and charged," said Abagnale. "The FBI will not investigate [an identity theft] crime less than $100,000. Most U.S. attorneys will not prosecute crimes under $250,000 and most district attorneys will not prosecute crimes under $5,000. The criminals know that if they stay under the threshold, they're not likely to get prosecuted. So we can't rely on the government to protect us, we can't rely on the bank to protect us, we can't rely on the police to protect us-- we have to be a little smarter, a little wiser."

Abagnale says that one of the best preventative measures against identity theft is education. He has dedicated much

of his time over the past 34 years educating people on the risks of identity theft and how to mitigate those risks. He has outlined a few simple steps that individuals can take to better protect themselves:

  • Use a micro-cut paper shredder, not ribbon-cut or crisscross cut shredders, to shred any documents that may contain PPSI (personal, private or sensitive information). Abagnale said it took him about eight hours to piece together incriminating documents from the Enron case that had been shredded by a crisscross shredder. The micro-cut shredder makes this impossible.
  • Pay to have your credit monitored. Abagnale said there are two things to consider when choosing a service to monitor your credit. First, it must monitor all three credit bureaus: Equifax, Experian, and TransUnion. It is useless if only one or two of the bureaus are monitored. Second, make sure that the monitoring service will notify you in real-time. It is a waste of money if the monitoring service only gives you monthly or annual reports. Even a letter in the mail will be too late to catch a potential thief. The monitoring service should notify you immediately -- whether by phone, e-mail or text message.
  • Use a credit card instead of a debit card, that way you are spending the credit card company's money and not your own. When a mass data breach has occurred, people who lost money from their checking account (by using their debit cards) took an average of eight weeks to see any type of restitution. People who had used a credit card were issued a new card and account number in a matter of days. Abagnale says that in addition to the added security of using a credit card, you will also build your credit score -- something you can't do by using a debit card.
  • Don't use personal checks. Nearly all the information needed to steal a person's identity is on that check: name, address, phone number, driver's license, expiration date, account number and routing number. Checks contain far too much information to leave unsecured. If another option is available, use it.

"To put a dent in the [identity theft] problem, it is important to get back to education," he said. "If you educate people, if you show them the risk and then you show them how to protect themselves they will take the necessary steps to do so but they need someone to tell them what to do."