Tuesday, Sept. 9, 2003 | 11:23 a.m.
To lessen the risk of becoming a victim of identity theft:
-- Source: Michael Associates
When detectives with Metro's repeat offender program arrested Neff last week on federal gun and drug charges, they discovered he had dozens of driver's licenses bearing his photograph and names of various unsuspecting people.
"He was getting pertinent information from an inside source and he was getting the IDs," Lt. Jim Moses said. Neff allegedly used the identification to bilk local residents out of thousands of dollars over the past month.
"We're up to our ears in paperwork to figure out who the victims are," Moses said. "It's just unbelievable how much crime one person can commit."
Today the General Accounting Office released the findings of a two-year study that showed state motor vehicle departments are still too vulnerable to fraudulent applications for driver's licenses. The matter has taken on national security significance since the Sept. 11, 2001, terrorist attacks.
Undercover agents, posing as applicants for driver's licenses, visited motor vehicle departments in seven states and presented forged documents using tools easily available online and in stores, including scanners, copiers, heavy paper and official looking seals and stamps. Agents were able to get licenses in each state.
Last week the Federal Trade Commission released the results of a study that showed 27.3 million Americans have been victims of identity theft in the past five years, including 9.9 million people last year alone.
Lt. Steve Franks of Metro's fraud and forgery units said the numbers are thought to be higher -- the department receives around 75 new identity theft cases every week. About one in eight local residents have been victims of identity theft, he said.
Violent crimes "get attention, but these people are stealing us blind," Franks said. "Each and every one of us are paying for these thieves."
Identity thieves use victims' name, address, Social Security number, bank or credit card number or other identifying information to commit fraud or theft.
In 2002 there were 1,165 identity theft cases reported in Las Vegas, according to the Federal Trade Commission. Statewide, the number was 1,705 last year. Nevada has the second highest number of identity theft cases. Washington, D.C., topped the list.
In the Neff case, he allegedly got key pieces of information on people from someone he knows who has access to such data. Using that information, he went to the Department of Motor Vehicles and obtained drivers' licenses.
Then he set up lines of credit at various stores where he bought costly merchandise, such as a $1,400 power generator from Home Depot, which he sold to a fence to support his methamphetamine habit, Moses said.
Police said Neff also used a computer program to create phony checks using victims' names. He cashed about 100 checks at $500 to $5,000 a pop at casinos and check cashing businesses all over the valley.
Detectives are trying to sort out the mess and contact the people who have been victimized. Chances are, the victims have no idea what happened to them.
Roy Michael, a Las Vegas mortgage broker and lecturer on identity theft, said it's not uncommon for it to take two to four years before a victim realizes what has been happening. Often, victims find out when they apply for a home or car loan.
The thieves change the victims' phone number and address on the billing records, "and it might get turned over to a collection agency and they can't find you. At that point it's being handled by attorneys, which means you need an attorney," Michael said. "That's where the costs really come in."
Michael was victimized about five years ago. He got a call from Western Union about a $7,000 transaction via a credit card to Mexico. He was able to cancel the transaction, but others aren't so fortunate.
It typically costs a victim about $5,000 and four years to fix things after their identity has been stolen, Franks said. The FTC has affidavits that identity theft victims can fill out to dispute unauthorized accounts or expenditures.
A number of laws limit consumers' liability if they are the victim of identity theft, but not all costs are covered. Last year's identity theft losses to consumer victims was $5 billion in out-of-pocket expenses. Businesses and financial institutions lost nearly $48 billion.
Police officers have even been victims.
Using a software program that tracks Social Security number use, Franks found that "a quarter of the detectives in fraud and forgery had been hit," he said.
Franks' wife was also victimized, he said.
"She forgot to tell me about those three houses she bought in Milwaukee, Wisconsin," Franks joked.
In one case, a 4-year-old boy bought a house, Franks said. The boyfriend of the child's mother was able to get the boy's Social Security number and his mother's maiden name easily.
The boyfriend "had what you call a substance abuse problem," Franks said.
The man forged papers to buy a house and wrote a phony $75,000 check for the down payment. The down payment only needed to be $50,000, so he was given a legitimate $25,000 check as change, which he pocketed, Franks said.
Metro detectives investigated a recent case of a woman whom the Internal Revenue Service said was employed simultaneously in nine different states.
Another woman lost her wallet containing her photo military identification, and it ended up in the hands of a woman who used it to buy merchandise at the Nellis Air Force Base exchange. The swindler then exchanged the items for cash using a completely different identity, Franks said.
Identity theft "is like a gift that keeps on giving," Franks said. "Once you're a victim you can never breathe easy again" because thieves are in contact with each other, and a victim's identity could be handed over to another crook.
The way things are going, Michael said, about one in two people will become victims of some form of identity theft. The problem is so prevalent because people often don't take the time to protect themselves.
A common way for thieves to steal identities is to "Dumpster dive," or go through peoples' trash looking for discarded mail or documents bearing the key pieces of information: name, address, social security number, date of birth and mother's maiden name, Michael said.
Thieves also steal mail out of residential mailboxes. Michael, Franks and Moses say they never leave outgoing mail in their home mailboxes; they drop mail off in blue postal boxes, walk the mail into the post office or mail bills from work. They recommend that everyone does the same.
"These are some very smart, extremely well-trained people doing this," Michael said. "These people hate you. You have something they want and they'll do anything to get it."
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