Identity Theft and Cybercrime

THE SCOPE OF IDENTITY THEFT

The 2015 Identity Fraud Study, released by Javelin Strategy & Research, found that $16 billion was stolen from 12.7 million U.S. consumers in 2014, compared with $18 billion and 13.1 million victims a year earlier. There was a new identity fraud victim every two seconds in 2014.

New account fraud also declined in 2014, according to the study. New account fraud occurs when a thief opens a new credit card or other financial account using the victim’s name and Social Security number. The thief runs up debts and leaves the victim responsible for the unpaid bills, and damaging the victims’ credit score. New account victims are three times more likely to take a year or more to discover that their identities were misused compared with other types of fraud, such as thieves taking control of existing non-credit card financial accounts. This allows criminals to use the victim’s identity for a long period, which can result in greater harm to consumers in the form of financial losses and problems with credit history and credit scores.

Of all demographic groups, students indicated the least amount of concern about fraud occurring, with about 65 percent saying they were not very concerned about fraud. Yet, this group is more likely than other demographic groups to perceive significant effects due to the occurrence of fraud (15 percent experiencing moderate or severe impact). Students are also the least likely to detect identity fraud themselves. In fact 22 percent of students who were victims of identity theft were notified of the fraud either by a debt collector or when they were denied credit, three times more frequently than other fraud victims.

IDENTITY THEFT AND FRAUD COMPLAINTS

The Consumer Sentinel database, maintained by the Federal Trade Commission (FTC), contains over 10 million consumer fraud and identity theft complaints that have been filed with federal, state and local law enforcement agencies and private organizations from 2010 to 2014. In 2014 over 2.5 million complaints were filed.

Of the 2.5 million complaints received in 2014, 60 percent were related to fraud, 13 percent were related to identity theft, and 27 percent were for other consumer complaints. The FTC identifies 30 types of complaints. In 2014, for the 15th year in a row, identity theft was the No. 1 type of complaint among the 30 categories, accounting for 332,646 complaints, followed by debt collection, with 280,998 complaints. Internet services, with 46,039 complaints, ranked tenth.

  

IDENTITY THEFT AND FRAUD COMPLAINTS, 2012-2014 (1)

(1) Percentages are based on the total number of Consumer Sentinel Network complaints by calendar year. These figures exclude "Do Not Call" registry complaints.

Source: Federal Trade Commission.

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HOW VICTIMS' INFORMATION IS MISUSED, 2014 (1)

Type of identity theft fraud Percent
Government documents or benefits fraud 38.7%
Credit card fraud 17.4
Phone or utilities fraud 12.5
Bank fraud (2) 8.2
Attempted identity theft 4.8
Employment-related fraud 4.8
Loan fraud 4.4
Other identity theft 21.8

(1) Percentages are based on the total number of complaints in the Federal Trade Commission’s Consumer Sentinel Network (332,646 in 2014). Percentages total to more than 100 because some victims reported experiencing more than one type of identity theft.
(2) Includes fraud involving checking, savings and other deposit accounts and electronic fund transfers.

Source: Federal Trade Commission.

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IDENTITY THEFT BY STATE, 2014

 

State Complaints per
100,000 population (1)
Number of
complaints
Rank (2) State Complaints per
100,000 population (1)
Number of
complaints
Rank (2)
Alabama 77.7 3,770 22 Montana 57.2 585 40
Alaska 73.6 542 29 Nebraska 48.6 914 46
Arizona 96.0 6,460 9 Nevada 100.2 2,846 8
Arkansas 83.6 2,481 15 New Hampshire 54.7 726 41
California 100.5 38,982 7 New Jersey 79.9 7,144 19
Colorado 85.5 4,579 13 New Mexico 77.2 1,611 23
Connecticut 85.4 3,071 14 New York 80.8 15,959 17
Delaware 78.1 731 21 North Carolina 73.8 7,334 27
Florida 186.3 37,059 1 North Dakota 43.1 319 48
Georgia 112.7 11,384 5 Ohio 79.0 9,161 20
Hawaii 40.9 580 49 Oklahoma 68.5 2,656 32
Idaho 58.9 962 39 Oregon 124.6 4,946 3
Illinois 95.6 12,317 12 Pennsylvania 81.7 10,446 16
Indiana 68.2 4,498 33 Rhode Island 66.2 699 34
Iowa 48.5 1,506 47 South Carolina 73.3 3,540 30
Kansas 65.2 1,892 35 South Dakota 36.3 310 50
Kentucky 53.4 2,358 43 Tennessee 76.2 4,993 24
Louisiana 73.8 3,430 27 Texas 95.9 25,843 10
Maine 52.1 693 44 Utah 53.9 1,586 42
Maryland 95.9 5,734 10 Vermont 64.2 402 36
Massachusetts 75.8 5,116 25 Virginia 71.1 5,921 31
Michigan 104.3 10,338 6 Washington 154.8 10,930 2
Minnesota 59.2 3,229 38 West Virginia 61.4 1,136 37
Mississippi 80.5 2,409 18 Wisconsin 74.4 4,283 26
Missouri 118.7 7,195 4 Wyoming 49.1 287 45

(1) Population figures are based on the 2014 U.S. Census population estimates.
(2) Ranked per complaints per 100,000 population. The District of Columbia had 142.8 complaints per 100,000 population and 941 victims. States with the same ratio of complaints per 100,000 population receive the same rank.

Source: Federal Trade Commission. 

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CYBERCRIME

As businesses increasingly depend on electronic data and computer networks to conduct their daily operations, growing pools of personal and financial information are being transferred and stored online. This can leave individuals exposed to privacy violations and financial institutions and other businesses exposed to potentially enormous liability, if and when a breach in data security occurs.

In 2000 the Federal Bureau of Investigation, the National White Collar Crime Center and the Bureau of Justice Assistance joined together to create the Internet Crime Complaint Center (IC3) to monitor Internet-related criminal complaints. In 2014 the IC3 received and processed 269,422 complaints, averaging about 22,500 complaints per month. The IC3 reports that 123,684 of these complaints involved a dollar loss and puts total dollar losses at over $800 million. The most common complaints received in 2014 involved auto and real estate fraud and government impersonation email scams.

Interest in cyber insurance and risk has grown in 2014 and 2015 as a result of high-profile data breaches, including a massive data breach at health insurer Anthem that exposed data on 78.8 million customers and employees, and another at Premera Blue Cross that compromised the records of 11 million customers. The U.S. government was targeted by hackers in two separate attacks in May 2015 that compromised the personnel records of as many as 14 million current and former civilian government employees. A state-sponsored attack against Sony Pictures Entertainment, allegedly by North Korea, made headlines in late 2014.

Cyberattacks and breaches have grown in frequency, and losses are on the rise. In 2014 the number of U.S. data breaches hit a record 783, with 85.6 million records exposed. At 781 in 2015, the number of breaches was about the same, but the number of records exposed doubled to about 169 million. The majority of the 781 data breaches in 2015 affected medical/healthcare organizations (66.7 percent of total breaches) and government/military (20.2 percent), according to the Identity Theft Resource Center. These figures do not include the many attacks that go unreported. In addition, many attacks go undetected. Despite conflicting analyses, the costs associated with these losses are increasing. McAfee and the Center for Strategic and International Studies (CSIS) estimated the likely annual cost to the global economy from cybercrime is $445 billion a year, with a range of between $375 billion and $575 billion.

 

NUMBER OF DATA BREACHES AND RECORDS EXPOSED, 2006-2015

 
 

 

CYBERCRIME COMPLAINTS, 2010-2014 (1)

(1) Based on complaints submitted to the Internet Crime Complaint Center.

Source: Internet Crime Complaint Center.

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TOP 10 STATES FOR CYBERCRIME, 2014

Rank State Percent (1)
1 California 12.54%
2 Florida  7.56
3 Texas 6.87
4 New York 5.85
5 Pennsylvania 3.30
6 Illinois 3.14
7 Virginia  2.88
8 New Jersey 2.85
9 Washington 2.59
10 Ohio 2.48

(1) Percent of complaints submitted to the Internet Crime Complaint Center via its website.

Source: Internet Crime Complaint Center.

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FOR MORE INFORMATION OR TO REPORT A COMPLAINT:

Federal Trade Commission

Internet Crime Complaint Center