The Javelin Strategy & Research Institute just released its fifth annual report on identity theft. The results are a mixed bag…Read on for the overview.
The Bad News
Between 2003 and 2007, the number of Americans affected by this crime was falling. But now, it appears we’re on an upwards trend again, with the overall number of victims reaching 2003 levels (around 10 million).
Many say that this increase is due to the bad economy. When money gets tight, crime goes up. And identity theft is a much lower-risk crime for thieves than, say, armed robbery. The vast majority of identity thieves are never caught, so the crime remains largely unpunishable. On top of that, it’s fairly easy to do.
The Good News
While there are almost 2 million more ID fraud victims in 2008 than in 2007, the good news is that each victim is spending a smaller amount of money to clear her name. In 2008, it took fraud victims an average of only $500 out-of-pocket expenses to remedy the damage. And over half of victims paid nothing due to the many zero-liability fraud protection programs offered by financial institutions these days.
The primary reason behind this positive trend is heightened awareness. Americans are wearier than ever of the damaging effects of identity theft, and are taking precautions to protect themselves. Protective actions include closely monitoring monthly account statements for unauthorized charges, enrolling in credit monitoring services to know when an unauthorized account is opened, and better protecting personal information both online and off. It is much easier and less expensive to correct the crime when you catch it as soon as it happens.
Identity thieves still greatly prefer the old-fashioned methods for stealing your identity. Lost or stolen wallets account for nearly half of all identity fraud. Card skimming—the practice of stealing credit or debit card information during a transaction—is the second most popular method, accounting for 19% of all ID theft. Hi-tech methods, such as stealing your information online and hacking into company databases, remain less popular. Only a quarter or so of identity thieves steal your information through these types of digital means.
You can access the condensed (and free) version of the Javelin report here. You can also purchase the complete findings (which contain 97 pages and 57 graphs and tables) at www.javelinstrategy.com or by calling a sales representative at (925) 225-9100 ext. 35.