Originally created 05/27/98

Criminal use of credit cards, Social Security numbers on the rise



WASHINGTON -- The government is finding more criminal use of personal identification information such as stolen credit card and Social Security numbers, according to report Tuesday by federal auditors.

"When anyone with a little time and a few dollars can access your Social Security number, unlisted telephone number and even your mother's maiden name, it is time for Congress to step in and take some action," said Rep. Jerry Kleczka, D-Wis., one of the lawmakers who requested the report from the General Accounting Office.

Kleczka has introduced legislation that would limit the commercial use of Social Security numbers. Other lawmakers have suggested giving victims legal protection independent of banks that sometimes decide it's easier to accept financial losses than investigate credit card fraud.

There is no comprehensive way to tally the incidence of so-called identity fraud because it encompasses a wide variety of illegal activities that can be part of larger financial crimes, said the GAO, Congress' investigative and auditing arm.

However, federal agencies reported increases in their detection of some specific types of fraud. For example:

-- The Secret Service, which has primary responsibility for investigations involving credit card fraud, made 9,455 arrests involving identity fraud worth $745 million in 1997, compared with 8,686 in 1996. Officials attributed the increase in part to new technology such as the Internet that makes credit card fraud easier. However, Secret Service agents also are trained better to detect it than in the past.

-- The Postal Service reported that arrests for change-of-address fraud -- when a criminal has people's mail diverted to get hold of bank statements, credit cards or benefit checks -- more than doubled in 1997 to 115 from 53 in 1996.

-- The Internal Revenue Service detected 2,470 schemes to use Social Security numbers and other personal information to fraudulently claim tax refunds during the first three quarters of 1997, compared with 2,458 for all of 1996. Tax agency officials, however, said recent staff cuts mean they are catching fewer perpetrators of such crimes than earlier this decade.