(Except for 2012, the data shown in Figures 1 and 2 represent adjusted data, which is more accurate for comparison purposes. Why? Because when the complaint data is reported for any given year it doesn’t include all the complaints for that year because some agencies report their data too late to be posted. The “late” data is used when that year’s data is adjusted in the following year’s report.)
Figure 1 shows a shift from previous years in the percentage of complaints within each of the three main classifications with “identity theft,” “other” and “fraud” accounting for 18 percent, 30 percent and 52 percent respectively. Comparable percentages were 15 percent, 30 percent and 55 percent for 2011 and 17 percent, 27 percent and 56 percent for 2010.
A total of 67,018 military consumer complaints were reported in the total CSN data in 2012 compared to 18,644 in 2011 — a significant increase. This included 27,790 (37 percent), 30,828 (46 percent) and 11,393 (17 percent) complaints for the “identity theft,” “fraud” and “other” categories respectively in 2012 compared to 4,976 (27 percent), 11,186 (60 percent) and 2,424 (13 percent) in 2011.
Compared to the percentages for the three complaint categories for the total CNS complaint data, the military consumer complaint data differs dramatically and significantly. For example, the “identity theft” category complaint percentage for the military consumers was more than double (37 percent versus 18 percent) that of the total CNS reported identity theft complaints. In a similar fashion, the military consumer complaint percentages for the “other” category were significantly less (approximately 17 percent versus 30 percent) of the total CNS reported “other” complaints whereas the percentage of complaints reported for the military for the “fraud” category somewhat less (46 percent versus 52 percent) than the total CNS reported “fraud” complaints.
Figure 3 shows a relatively dramatic increase in identity theft complaints for 2012 with 369,132 reported compared to 279,226 for 2011 (adjusted from 279,156). This places the 2012 complaint data at a record high — beating the previous record high of 314,595 reported in 2008.
COMMON IDENTITY THEFT FRAUDS
How do fraudsters use the PII of identity theft victims to commit fraud? The following analysis should help to answer this question.
The major types of identity theft-related frauds and their complaint percentages in 2011 and 2012, respectively, include “credit card fraud” (14.3 percent and 13.4 percent), “government documents or benefit fraud” (46.4 percent and 27.4 percent), “phone or utilities fraud” (13.4 percent and 9.7 percent), “employment-related fraud” (8.4 percent and 5.4 percent), “bank fraud” (8.7 percent and 6.4 percent), “loan fraud” (3.1 percent and 2.4 percent), “other identity theft fraud” (23.7 percent and 18.5 percent) and “attempted identity theft” (6.8 percent and 6.6 percent). (These percentages don’t add up to 100 percent in either year because some of the complaints included more than one type of identity theft.)
To go a little deeper into the analysis, we need to look at the changes in the percentages noted above.
Credit card fraud
The CSN report shows that the total credit card fraud complaints actually increased from 39,929 to 49,463 — a significant amount — while their percentages of total identity theft complaints decreased from 14.3 to 13.4 percent.
The differences are attributed to the changes in their related subtype categories. For example, the subtype category “new credit card accounts fraud” complaints accounted for the majority of the overall increase as they increased from 23,734 to 32,484 (from 8.5 percent to 8.8 percent of the total identity theft complaints) while “existing credit card account fraud” complaints category increased insignificantly from 16,195 to 16,980 (from 5.8 to 4.6 percent).
The total credit card complaints are up significantly, and it probably would be much worse if it weren’t for the effectiveness of increased public awareness programs sponsored by financial and governmental agencies, which help to educate individuals about the use and protection of credit cards and credit card applications. However, identity theft related to credit card fraud was still a major problem in 2012; it accounted for 13.4 percent of the total reported CSN complaints.
“New credit card accounts fraud,” which accounted for 8.8 percent or 32,484 of the total identity theft complaints, is intolerable; it’s something that can be reduced dramatically very easily.
Entities typically market new credit cards through the mail via “pre-approved” credit card offer applications, many of which are directly stolen from mailboxes and through careless disposal by consumers. Individuals can opt out of the “pre-approved” credit card offers sent through the mail by visiting www.optoutprescreen.com or by calling 1-888-5657-8688. If more people used the service, identity theft related to “new credit card account fraud” would decrease significantly.
CSN showed 3,538 “credit card fraud” complaints for military consumers in 2012, which was approximately 14.3 percent of their total identity theft complaints, compared to 1,317 and 20 percent in 2011. This is similar to “credit card fraud” for the total complaint data for the general population, i.e. 14.3 percent compared to 13.4 percent.
The subtype category “new accounts credit card fraud” accounted for 9.2 percent or 2,290 of total complaints for military consumers in 2,012 (compared to 16.6 percent or 827 in 2011), which is comparable to the 8.8 percent reported for total “new accounts credit card fraud” for the general population. “Existing accounts credit card fraud” for military consumers accounted for 5.1 percent or 1,258 of their total complaints for 2012 (compared to 490 or 9.8 percent in 2011) or slightly more than the 4.6 percent recorded for the general population’s total “existing credit card fraud.”
Military consumers are having difficulty protecting their existing credit cards and handling “pre-approved credit card offer” applications; their credit card complaint numbers have increased more than 300 percent overall compared to 25 percent for the general population. However, the increase in the rate of occurrence in credit card fraud is disturbing for both groups and needs to be curtailed with accelerated educational programs.