Identity theft summit warns new hardware poses new risks

Posted 9/10/11

Advances in technology are opening new doors for identity thieves, who can do thousands of dollars in damages with little more than a $200 …

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Identity theft summit warns new hardware poses new risks


Advances in technology are opening new doors for identity thieves, who can do thousands of dollars in damages with little more than a $200 investment.

New technology was at the center of a Sept. 7 identity theft summit in Douglas County that taught nearly 60 law enforcement agents from across Colorado what to look for in identity theft investigations.

The bad news: identity theft leaves few clues to track perpetrators. The good news: there are ways for consumers to protect themselves. That is according to the instructors from LifeLock and FBI-Law Enforcement Executive Development Association, which conduct identity theft summits across the country.

LifeLock, specializing in fraud and identity theft protection and education, joined forces with the FBI to train agencies in what the Social Security Administration calls one of the fastest growing crimes in the country. Their efforts have, since 2008, reached more than 5,000 law enforcement agents from 1,700 agencies nationwide, said H. Dean Crisp, FBI-LEEDA instructor.

While the Federal Trade Commission reports more than 237,000 cases of identity theft in 2010, those numbers are vastly underreported, Crisp said. Most victims don’t know to take the extra step to report the crime to the FTC, he said. As part of its annual report, the FTC tracks lack of reporting to law enforcement agencies, particularly in identity theft. According to the annual FTC Consumer Sentinel Network report, Colorado ranked first in 2010 in fraud reports and 11th in identity theft.

The increase in identity theft crimes drew local law enforcement agencies and agents from the Secret Service, Colorado Bureau of Investigation, the U.S. Probation Office and investigative agencies from across the Front Range to attend the day-long summit. The day’s class included demonstrations of pocket-sized devices called “skimmers” that capture information off a credit or debit card with a single swipe.

Several attendees handed over identification cards, military-issue identifications and membership cards that, within minutes, displayed personal account information from about 15 cards onto a computer screen. The skimmers can be purchased online for about $200 and are invaluable to any criminal with more than a moment of unsupervised access to a credit or debit card, LifeLock spokesman Mike Prusinski said.

The data is transferred to a computer and can be used to make online, telephone or other purchases. Some skimmers come with Bluetooth technology that automatically sends the information directly to the computer, Prusinski said.

“Your only guard is to never hand your card over,” he said. “When you’re at a restaurant paying your bill, as a consumer, you have the right to follow your card. The easier answer is to have the restaurant bring a hand-held scanner to the table to scan your card.”

Perpetrators with the right tools can take the extra step with an encoder, a table-top device that measures about 8 inches by 2 inches and can be used to read and duplicate a card. Perpetrators make copies of cards for purchases such as pay-at-the-pump gas stations or at retailers that don’t match the card to the purchaser.

LifeLock also demonstrated “sniffing,” a computer program that poses as a public wifi access spot. Users who tap into the free wifi are exposed to a program that opens the door to the user’s computer. The program can provide access to all key strokes, passwords and financial information stored or entered into the computer, Prusinski said.

Similar hardware can be installed on a remote pay station, such as a gas station pump, or on a counter-top scanner at retail establishments, he said. But the hardware is not the biggest challenge.

“The technology part is just the sizzle,” Prusinski said. “The sexy part (is) the hackers who breach hundreds of millions every single year.”

Douglas County agencies have seen an increase in identity theft and fraud reports and many who attended the seminar were surprised by the added vulnerabilities that go hand in hand with new technology.

Mark Foster is a Castle Rock police officer who has been in law enforcement for 25 years. He came away with a new appreciation for paying in cash.

“I never realized how much technology is available today to scam people,” Foster said. “Even people who are really conscious can still get ripped off.”

Instructors at LifeLock recommend using credit cards for purchases instead of debit cards because credit cards have built-in protection to more efficiently handle disputed purchases. They also recommend consumers never hand over a credit or debit card to a retailer, check all counter-top scanners for any signs of tampering and avoid using remote pay stations whenever possible.

The 18th Judicial District Attorney’s Office is investigating a case of identity theft among gas stations along the I-70 corridor from Limon and through Adams and Arapahoe counties, said Mason Finks, director of consumer protection, 18th Judicial District Attorney’s Office. Number of victims at last count: 70, including District Attorney Carol Chambers, when she handed her card over to pay for coffee at a  truck stop. Two weeks later, her card was used for a purchase in Arizona.

Crisp is among those who hope an increase in awareness and more regular reporting can result in more resources toward the effort to fight identity theft and consumer fraud.

“If I rob a bank, I might get $3,000 and everyone is looking for me,” Crisp said. “But if I rob your identity, I can get $30,000 and no one is looking for me. It’s hard to track and criminals are learning that.”


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