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As you start Christmas shopping, thieves are shopping for your identity

Tuesday, Nov. 22, 2005

With the holiday shopping season beginning officially on Friday, the odds that someone will try to steal your identity go up.

‘‘The opportunity is definitely there,” said Montgomery County Police Detective David Hill. ‘‘You’re using your card more.”

Any other time of year, an unusual purchase might trigger warning bells at the credit card company, Hill said, but the companies expect you to rack up bigger bills than usual during the holidays.

Click here to enlarge this photo Click here to enlarge this photo Dan Gross⁄The Gazette

Retailers, who ring up almost 20 percent of their sales in November and December, estimate shoppers will spend $435.3 billion in stores and online over the next six weeks. That’s up 5 percent over last year, according to the National Retail Federation’s annual survey.

And no matter how careful you are, experts say, identity thieves can take advantage.

Take Cheryl C. Kagan.

A year ago, the former state legislator’s credit card information was stolen while she was dining at a Rockville restaurant.

A waiter ran her credit card through an electronic device known as a ‘‘skimmer,” capturing data from the magnetic strip and allowing the thief to transfer the data onto the magnetic strips of other cards, Hill explained.

Three months later, the same thing happened again with the replacement card she was issued.

Kagan said the experience left her feeling like she did when a burglar broke into her home years ago.

‘‘There’s a similar feeling of violation,” Kagan said. ‘‘They don’t come in and take your CD player, but they come in and take your reputation and credit history, and in a way that’s a lot harder to ever get back.”

Kagan was among the 4,612 Marylanders who had their identities stolen last year, according to the Federal Trade Commission, which tracks some ID thefts. That number does not include all cases of ID theft because the crimes may be reported many different ways. Maryland is ranked 16th in the nation in ID theft.

It’s happening all over the country.

ID thieves have hacked into a credit card processing company, CardSystems Solutions in Atlanta, that contained information on 40 million credit card holders in late May. A year ago, data mining company ChoicePoint of Alpharetta, Ga. sold the credit reports, including Social Security numbers, of at least 145,000 people to a fake company set up to steal identities. Bank of America lost the information of 1.2 million people in February. CitiFinancial, a financial services company, had its backup computer files with the information of 3.9 million customers stolen from a delivery truck in June.

The scariest part of identity theft is how easy it is.

Kagan considered herself protective of her personal identity.

She checks her monthly credit card statement and reviews her credit report — two safeguards recommended by ID theft prevention experts, Kagan said.

But she was one of an unknown number of victims who had credit card data stolen when she dined at a Rockville restaurant.

When customers paid for their meals with their credit cards, the suspect, a waiter, swiped the cards through the skimmer and went on a spending spree, Hill said.

Kagan’s bank noticed unusual charges to her card and notified her. The card was canceled and she obtained a replacement.

But when she dined at the restaurant again, her replacement card number also was stolen.

Kagan was not the only victim. At least 40 people had their credit card identities stolen over eight months before police arrested the restaurant worker and a co-defendant in July. The two men are awaiting trial.

‘‘I was lucky in a lot of ways,” said Kagan, who had worked on consumer protection issues as a delegate in Annapolis. ‘‘First off, I had a bank that was very vigilant, and I’m an educated consumer, so I always checked my credit card statements.”

Tough to prove

Thieves do not always use high-tech equipment to steal identities.

In July 2004, county police and U.S. Secret Service agents raided the home of a Rockville woman and discovered she had the personal information for more than 300 people, said county Detective Scott Wyne said.

Wyne, who said he spent six months investigating the case, said he could not charge Christine Teresa Deleva with all of the crimes he suspected her of committing without devoting an entire year full time to the case.

‘‘She was a brash, one-man crime wave,” Wyne said.

Deleva received a 1-year prison sentence in May after pleading guilty to theft and fraud charges.

Deleva obtained IDs and credit card numbers from a variety of ways: by breaking into a neighbor’s mailbox, from a friend who worked at a limousine service, from another friend at a rental storage facility, and another at a mortgage company.

Using the names of other people, she obtained a $15,000 loan from a Rockville credit union, ordered and ran up $13,000 in cell phones and services, and charged more than $30,000 in airline tickets.

Her victims did not discovered what she was doing until misdelivered envelope tripped her up.

A postal worker delivered a letter with her neighbor’s name, but with Deleva’s address, to the neighbor’s address. Inside was a check for half of a $15,000 loan that Deleva had obtained from CitiFinancial in Gaithersburg.

With just a checking account statement and a utility bill stolen from her neighbor’s mailbox, Deleva had enough information to obtain the loan and open a checking account in her neighbor’s name, Wyne said.

Deleva’s attorney, Matthew F. Davies of Riverdale, could not be reached for comment.

‘‘There’s no way to stop it unless businesses are held liable,” Wyne said. ‘‘Businesses need to take this seriously.”

Growing problem

Kagan’s vigilance — and her bank’s — paid off in protecting her credit rating and her pocketbook.

The charges were removed from her account. She contacted the fraud department of a credit bureau and filed a report with the FTC.

Kagan said she spent long hours on the phone and checking account statements to make sure her credit history was restored.

‘‘I’d always been a very prudent and careful consumer, and for someone to swoop in and compromise the integrity of my credit history is really an outrage,” Kagan said.

A study by the Internet Theft Resource Center of San Diego showed the average victim suffers about $1,400 in out-of-pocket losses.

Part of the problem is financial institutions make it too easy to obtain credit cards and loans, Wyne said.

In addition, retailers would rather make a sale quickly instead of spending time checking that the buyer’s identification matches the credit card, he said.

The other part of the problem is businesses do not do enough to protect the credit card numbers and personal ID information of their consumers, Wyne said.

Last spring, police on an unrelated stakeout watched two men dive into a Dumpster and pull out a garbage bag, Wyne said. The officers pulled the car over and discovered the bag filled with credit card receipts. Instead of being shredded, the receipts were intact.

Wyne met with the business’s manager the next day.

‘‘I said, ‘Do you know what’s happening at night here?’” Wyne said. ‘‘All he says is, ‘What do you want me to do about it?’”

The answer was simple, Wyne said: Shred the receipts.