FinCEN report: Identity Theft Trends, Patterns, and Typologies Reported in Suspicious Activity Reports Filed by Depository Institutions January 1, 2003 – December 31, 2009

From the Financial Crimes Enforcement Network report, Identity Theft Trends, Patterns, and Typologies Reported in Suspicious Activity Reports Filed by Depository Institutions January 1, 2003 – December 31, 2009, the Executive Summary:

Identity theft was the sixth most frequently reported characterization of suspicious activity within the period of the study, behind structuring/money laundering, check fraud, mortgage loan fraud, credit card fraud, and counterfeit check fraud. Based upon analysis of the study sample, the number of identity theft-related depository institution SAR filings submitted during calendar year (CY) 2009 was 123 percent higher than the number reported in CY 2004. This compares with an 89 percent increase in the numbers of all depository institution SAR filings made in CY 2004 versus CY 2009.

Over 86 percent of sample depository institution SAR filings bearing either the identity theft suspicious activity characterization or identity theft-associated keywords in their narratives actually described identity theft. Most of the remainder of the filings described identity fraud or provided insufficient information to confirm identity theft.

Credit card fraud was the most frequently co-reported suspicious activity characterization with identity theft, appearing in over 45.5 percent of sample filings.  In about 30 percent of these filings reporting the successful takeover of an existing credit card account, and 17 percent reporting the successful unauthorized set up of a new credit card account, the alleged identity thief added his/her name to the account as an authorized user.

Several types of loan accounts were reportedly abused in 31 percent of filings. In 56.5 percent of filings specifically reporting student loan fraud, subjects included both their name and the victim’s name on the loan application as either the borrower or co-signer.

Analysis of the sample indicated that filers reporting auto loan fraud facilitated by identity theft were successful in identifying these loans as fraudulent prior to funding in 49.5 percent of filings. Similarly, filers reporting student loan fraud facilitated by identity theft identified the loans as fraudulent prior to funding in 54.5 percent of filings.

Nearly 27.5 percent of sample identity theft SAR narratives reported that the identity theft victim knew the suspected thief, who was usually a family member, friend, acquaintance, or an employee working in the victim’s home. Computer-assisted identity theft was described in 4 percent of filings. Fraud rings that employ identity theft to further their illicit activities were reported in 3.5 percent of filings overall, with the year-to-year trend line strongly up in every period except 2005-2006.

Victims reportedly discovered identity theft through review of their own account activity in about 28 percent of filings in the sample. Filers credited routine financial institution account monitoring with uncovering identity theft in nearly another 21 percent of sample filings, and checks of commercial databases at account set-up in 14.5 percent of sample filings. Credit reports, law enforcement investigations, collection agencies, and credit monitoring services were responsible for revealing identity theft in a decreasing percentage of sample filings.

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