According to Javelin Strategy & Research, small business owners suffered identity fraud at one-and-a-half times the rate of other adults in 2009. Much of this theft occurred as online identity theft via web-based transactions or hacking into customer databases or morphed into online identity theft when the stolen information was used to impersonate another person in online transactions.

In November 2009, Javelin Strategy and Research conducted telephone interviews with more than 5,000 U.S. consumers to identify and track the methods used by criminals and the impact of all types of identity theft, including online identity theft on American consumers and businesses. Almost 4,800 U.S. adults, including 487 victims of identity theft, were surveyed. It appears from the study that the susceptibility of small business to identity theft may be attributed to the fact that small business owners often use personal accounts when making business transactions (and vice-versa) and make a larger number of transactions than typical adults. Since small businesses rarely employ a compliance department or on-site legal counsel to monitor its operations on a regular basis, incidents of online identity theft can sometimes go undiscovered for a longer period of time than for individuals or more complex, larger organizations.

Online identity theft criminals are increasingly using stolen information to open new credit card accounts, e-mail payment accounts and cell-phone accounts, all of which can be opened, used and monitored online from anywhere in the world.

Increased vigilance by consumers, businesses and government agencies appear to be having an impact on the problem. Many organizations, especially banks and financial institutions have started offering online identity theft monitoring services, which can sometimes detect account access and payment anomalies, as well as dispute resolution and identity theft education programs, in most cases offering these services free to customers. Mobile banking solutions allow account monitoring, alerting customers in near-real-time of account activity and possible fraud. These partnerships and increased activism on the behalf of consumers resulted in consumer out of pocket costs dropping to an all-time low of $373 in 2009.

When it comes to online identity theft, the “good news” is that consumers are increasingly aware of e-mail scams such as “phishing.”, and less likely to respond to e-mail requests for personal information. The use of mobile devices allows consumers to review and report identity theft in close to “real-time,” which may result in lower victim costs and faster incident detection times.

Without a doubt, consumers play a key role in preventing, detecting and resolving online identity theft . While technology is helping consumers to monitor, detect and resolve identity fraud, consumers should remain vigilant about safeguarding their personal information both on-line and off.

The Javelin Research and Strategy 2010 survey of identity theft revealed that the efforts made by businesses and individuals in detecting and resolving identity theft cases have helped to reduce the overall costs of identity theft for the consumer. In 2010 the average resolution time of fraud cases fell by 30%, and an increase in the number of victims who file police reports resulted in a larger number of arrests, prosecutions and convictions in 2009.

While efforts helping consumers monitor, detect and resolve identity theft, additional efforts should be made in preventing identity theft in the first place. Without a doubt, consumers must play a key role in preventing identity theft . While technology is helping, consumers should remain vigilant about safeguarding their personal information both on-line and off.

The Javelin study outlines three areas where individuals can work toward preventing identity theft in the first place, and outlines five basic areas consumers can focus on.

Protect your documents
•    Eliminate as many paper statements as possible by requesting electronic statements instead
•    Use post office boxes to mail payments rather than placing mail containing checks in an unlocked mailbox
•    Secure documents containing personal information such as social security numbers or account numbers in a locked storage box
•    Purchase and use a paper shredder

Protect your computer
•    Install antivirus software and update it regularly
•    Password protect personal and financial records, using unique or hard-to-guess passwords
•    Never give out personal or account information on-line or over the phone
•    Don’t publish personal information on social networking sites such as FaceBook

Monitor your accounts
•    Check your bank and credit card activity periodically – and sign up for alerts whenever possible. The javelin study found that 43 percent of all reported identity fraud cases were spotted by consumers self-monitoring their accounts and those who use more timely electronic methods to detect fraud experience lower average out-of-pocket costs
•    Utilize an identity theft protection service to help detect the fraudulent establishment of new accounts in your name. Identity thieves are increasingly using stolen information to open new credit card accounts, on-line and e-mail payment accounts and cell-phone accounts.

Although the overall number of incidents of identity theft increased by 12% over the previous year, the average consumer’s costs related to each incident of identity theft decreased sharply during the same time period. James Van Dyke, president and founder, Javelin Strategy & Research commented, “The good news is consumers are getting more aggressive in monitoring, detecting and preventing fraud with the help of technology and partnerships with financial institutions, government agencies and resolution services.”

In November 2009, Javelin Strategy and Research conducted telephone interviews with more than 5,000 U.S. consumers to identify and track the methods used by criminals and the impact of identity theft on American consumers and businesses. Almost 4,800 U.S. adults, including 487 victims of identity theft, were surveyed via a 50-question phone interview to gain insight into this crime, its effects on its victims, and how the survey findings can help consumers in preventing identity theft. The survey has been conducted each year since 2003.

More consumers than ever before are actively monitoring their credit and financial accounts for suspicious activity and fraud and are acting faster when identity theft is detected.

More than ever before, consumers and businesses are investing time and money in identity theft protection, the latest survey by Javelin Strategy and Research shows. A survey of consumers and businesses conducted in November, 2009 showed that many consumers are monitoring their accounts more frequently using technologies such as on-line banking, mobile alerts and identity theft protection services. Increasingly, efforts by consumers, businesses and government agencies to safeguard sensitive personal and financial information have helped in resolving identity theft cases more quickly and have resulted in an overall reduction of the costs of identity theft.

With the exception of consumers aged 18 – 24, many consumers are found to be more likely to monitor their accounts regularly, to take advantage of identity theft protection programs offered by financial institutions and to install anti-virus or anti-malware software on their home computers.

Many organizations, especially banks and financial institutions have started offering fraud monitoring services, which can sometimes detect account access and payment anomalies, as well as dispute resolution and identity theft education programs. The one glaring exception identified by the study are small businesses. The survey found that small business owners suffered identity fraud at one-and-a-half times the rate of other adults. This appears to be due to the fact that small or home office-based business owners tend to use personal financial accounts for business transactions and often make many more transactions than typical adults. Small businesses may not have the financial or other resources available to focus on preventing identity fraud or investing in identity theft protection programs and software.

Without a doubt, consumer education on identity theft protection and prevention measures such as keeping anti-virus software up to date will continue to be important. Many banks have offered customers more identity theft protection tools to safeguard electronic and traditional banking. Financial institutions are increasingly investing in identity fraud protection and monitoring software to detect account access and payment anomalies, as well as in consumer education efforts and customer complaint resolution services.

The 2010 Identity Fraud Survey Report was conducted using telephone interviews with more than 5,000 U.S. consumers to identify and track the methods used by criminals and the impact of identity theft on American consumers and businesses. Almost 4,800 U.S. adults, including 487 victims of identity theft, were surveyed.

Law enforcement had greater success in 2009 than in previous years using identity theft information provided by consumers, banks and credit card providers to detect, catch and convict criminals.

Increased vigilance by consumers, businesses and government agencies appear to be having an impact on the problem of identity theft. Many organizations, especially banks and financial institutions have started offering identity theft information monitoring services, which detect account access anomalies, in most cases offering these services free to customers. Mobile banking solutions allow financial account monitoring, alerting customers in near-real-time of account activity and possible fraud. These partnerships and increased activism on the behalf of consumers resulted in consumer out of pocket costs dropping to an all-time low of $373 in 2009.

Even more importantly, an increase in the number of victims who filed police reports resulted in a larger number of arrests, prosecutions and convictions in 2009. The Javelin survey determined that efforts to protect identity theft information and data by individuals and businesses have helped in resolving cases more quickly and have reduced the overall costs to the consumer. The average resolution time for identity theft cases fell by 30% in 2009.

The survey reinforced the idea that consumers can play a key role in preventing, detecting and resolving identity fraud committed against them. The report found that more consumers are pursuing legal action, with nearly 50 percent of all victims filing police reports. Increased consumer awareness of available identity theft information and resources has empowered consumers to fight back, leading to more arrests, prosecutions and convictions. More consumers than ever before are actively monitoring their credit and financial accounts for suspicious activity and fraud and are acting faster when identity theft is detected.

Among other things, the study found that:

• In 2009, more victims of identity theft were likely to have filed a police report, resulting in an increase in arrests and convictions of identity theft and identity theft related crime. Victims became more vigilant in reporting identity theft crimes, which resulted in an arrest rate double that of 2008, and a prosecution rate that tripled in comparison with the previous year.

• There is an indication that law enforcement has had greater success using identity theft information provided by consumers, banks and credit card providers to detect, catch and convict criminals.

• Banks have offered customers more tools to safeguard electronic and traditional banking, investing in identity fraud monitoring, software designed to detect account access and payment anomalies, and complaint resolution and education services, in many cases offering these services free to customers.

• Consumers are increasingly aware of e-mail scams such as “phishing.”, and less likely to respond to e-mail requests for personal information.

• The use of mobile devices allows consumers to review and report identity theft in close to “real-time,” which may result in lower victim costs and faster incident detection times.

The 2010 Identity Fraud Survey Report was conducted using telephone interviews with more than 5,000 U.S. consumers to identify and track the methods used by criminals and the impact of identity theft on American consumers and businesses. Almost 4,800 U.S. adults, including 487 victims of identity theft, were surveyed.

Although the overall number of incidents of ID theft increased by 12% over the previous year according to the most recent study by Javelin Strategy & Research (The 2010 Identity Fraud Survey Report – www.javelinstrategy.com), during the same time period, the average consumer’s costs related to each incident of ID theft decreased sharply.

ID theft reached its highest level of incidence, affecting over 11 million Americans for the year 2009. During 2009 however, there was a sharp drop in the costs to consumers associated with the crime. Due to a decrease in the average time taken to resolve ID theft cases, an increased awareness by the public of the crime of ID theft and greater support offered by financial institutions, consumer support organizations, law enforcement organizations and personnel, resulted in consumer out of pocket costs reaching an all-time low of $373 in 2009, a reduction of 25% over the previous year.

Some of the reasons for the drop in costs:

•    In 2009, more victims of ID theft were likely to have filed a police report, resulting in an increase in arrests and convictions of ID theft and ID theft related crime. Victims became more vigilant in reporting ID theft crimes, which resulted in an arrest rate double that of 2008, and a prosecution rate that tripled in comparison with the previous year.
•    There is an indication that law enforcement has had greater success using information provided by consumers, banks and credit card providers to detect, catch and convict criminals.
•    With the exception of consumers aged 18 – 24 (the so-called “Millenials”), many consumers are more likely to  monitor financial accounts regularly and take advantage of monitoring programs offered by financial institutions or to install protective computer software on their home computers. Although “millenials” lag behind other groups in detecting fraud before or soon after it occurs, they lead other age groups in using technology to resolve identity fraud quickly.
•    Consumers are reaping the benefits from increased protections offered by financial institutions, businesses and government agencies.
•    Banks have offered customers more tools to safeguard electronic and traditional banking, investing in identity fraud monitoring, intelligent fraud engines to detect account access and payment anomalies, and complaint resolution and education services, in many cases offering these services free to customers.
•    Consumers are increasingly aware of e-mail scams such as “phishing.”, and less likely to respond to e-mail requests for personal information.
•    The use of mobile devices allows consumers to review and report ID theft in close to “real-time,” which may result in lower victim costs and faster incident detection times.

The 2010 Identity Fraud Survey Report was conducted using telephone interviews with more than 5,000 U.S. consumers to identify and track the methods used by criminals and the impact of ID theft on American consumers and businesses. Almost 4,800 U.S. adults, including 487 victims of ID theft, were surveyed.

Without a doubt, consumers play a key role in preventing, detecting and resolving ID theft . While technology is helping consumers to monitor, detect and resolve identity fraud, consumers should remain vigilant about safeguarding their personal information both on-line and off.

Lots of crooks all across America have hung signs on their doors – “Gone Smishing.”

Thousands of cell phone users all over the country are regularly receiving automated messages or texts, warning them that their bank accounts have been misused.

Police and bank officials say it’s a scam, and that someone is attempting to steal your account numbers so they can withdraw your money and run up huge credit card purchases.
The calls or texts falsely warn that a person’s checking, debit or credit card account has been deactivated or used improperly. In each case, the person is asked to contact the caller and provide their credit, debit or bank account numbers.

This practice is called “smishing,” derived from Short Message Service technology, which is used for cell phone text messages. The term smishing is a mix of SMS technology with the practice of “phishing,” to send legitimate-looking e-mails and text messages to cell phones. In a banking context, these messages appear to come from the recipient’s bank or credit union.

Wireless cell phone companies are working on ways to block unwanted text messages, while customers are reporting increasing numbers of spam messages and smishing attacks. Some users are even forced to pay for the text messages they receive.

Some tips to avoid getting hooked into this scam:
• Do not reply to text messages that ask for personal for financial information.
• Do not call phone numbers listed in the text message. The area code shown does not necessarily reflect where the scammers really are.
• Do not go to Internet sites shown in the text message or e-mail.

If you receive a text message or e-mail on your cell phone that is not from your bank or credit union, delete the message immediately. If you do not know whether you have an account with the bank or credit union, or have a question regarding the message, call the bank or credit union to verify, using the telephone number you would normally use or can verify.

Additional tips to help you avoid identity theft:
• Review your bank and credit statements regularly. If any unauthorized transactions are listed. Notify your financial institution immediately to gain protection against the charges.
• Make sure to monitor your credit reports.
• If you receive a bill or statement, follow up with the company.
• Always keep your passwords confidential. Banks, credit unions and credit card companies will not ask you to disclose them.

According to www.recovery.gov, the White House Web site for all things economic recovery, a new scam has emerged.

Earlier this year, a phony company called Mouch & Thompson PLLC sent a letter to low income residents offering rental assistance grants under the American Recovery and Reinvestment Act. The letter stated that its first 50 recipients who showed up at the company’s offices would be guaranteed the money. The letter was supposedly penned by the company’s president, Wesley Mouch.

But the letter was, in fact, an identity theft scam. The company does not exist, and neither does its president.

According to officials in the Charleston, West Virginia are where the office was supposedly located, lots of people showed up. Investigators were tipped off about the scam, and placed surveillance cameras at the location, but the crooks never made an appearance.

And so ends another cautionary tale in the identity theft saga.

There are many scams currently being used to take advantage of those hit hardest by difficult economic conditions. Scammers often claim they can help eligible Americans obtain recovery money or other government funds. One such scam claimed that for a small credit card fee, a person could order a compact disc or gain access to another Web site explaining how to receive a $12,000 government grant. Those who took the bait were charged a monthly fee of up to $69.95.

Many of these scams use official government insignia or photos of President Barack Obama to lend their claims an air of credibility. The scammers also employ the use of e-mail, traditional mail, phone calls and radio announcements.

In this particular type of scam, criminals rely on the public’s lack of knowledge regarding Recovery Act programs, and will claim they can assist in acquiring grant or loan money, or even tax rebates, all available under the Recovery Act.

But the law has provided funds directly to individuals in only a few instances, such as in 2009 when the Recovery Act provided economic recovery payments through the Social Security Administration to individuals receiving Social Security or supplemental security income benefits.

The Federal Trade Commission, the Better Business Bureau and the Federal Bureau of Investigation regularly warn the public about stimulus scams, and investigators from these agencies say citizens should avoid providing any personal information to companies offering access to recovery money, and should immediately contact their state’s Attorney General if approached with such offers.

Identifying fraud is getting more and more tricky. Criminals have become more and more creative, and increasingly clever about disguising their methods. And on top of that, they’re using more sophisticated technology to commit crime.

Perhaps the most devious tactic being employed by criminals is that they are now targeting their crime. The most vulnerable are being targeted – weary homeowners in danger of losing their homes to foreclosure are enticed with foreclosure scams, while those drowning in debt are duped by offers to clean up or eliminate debt with little or no effort by the debtor.

But there are ways to recognize a scam. First, if you are told an offer will expire if you don’t respond immediately or quickly, and you feel pressured to make a decision, the offer could be fraudulent. Always take your time before committing to anything. You may also want to discuss the offer with friends. Others can often discern when an offer isn’t forthcoming.

Search for the company, the individuals and the offer online. If it is a scam, chances are you’ll find information about it online.

If the offer is from a well-known company, confirm it with them. Don’t just assume that because the offer says it’s from a particular company that that’s the case. Always confirm. Make sure that the phone numbers, links and addresses that came with the offer are legitimate.

One rule of thumb recommended by law enforcement officers is to ask yourself, “If I were made this same offer on the street, would I give out my personal information?” If not, then you shouldn’t give it out online.

If you can’t figure out any other way to determine whether something is legitimate, rely on your gut instincts. If you have any doubts about a particular offer, just don’t do it. Better safe than sorry.

One single criminal operation was responsible for two-thirds of all phishing” attacks in the second half of 2009 and is responsible for a two-fold increase in the crime, a report published by the Anti-Phishing Working Group (APWG) stated. Over the last three years, the Anti-Phishing Working Group’s semiannual Global Phishing Survey has become a widely cited source of information about the state of phishing and its effect on Internet users.

“Phishing,” is the process of attempting to acquire sensitive information such as user-names, passwords, social security numbers, credit card numbers and other personal and financial information by masquerading as a legitimate sender in an e-mail or other electronic communication. Messages that purport to be from popular social web sites, auction sites, on-line payment processors or web-site technical administrators are commonly used to lure individuals into responding. Phishing is typically done using e-mail or instant messaging, and messages usually instruct the reader to enter personal information at a fake website whose look and feel are almost identical to the one it mimics.

There were 126,697 phishing attacks during the second half of 2009, more than double the number in the first half of the year or from July through December of 2008, the APWG report said. Avalanche, which was first identified in December of 2008, was responsible for almost one-quarter (24%) of attacks in the first six months of 2009 and for almost two-thirds (66%) over the remainder of the year. Avalanche targeted more than 40 major financial institutions, online services, and job search providers.

The APWG report stated that, during the attacks, “ … target institutions, the relevant domain name registrar(s), a domain name registry, and other responders and service providers to all be aware of the campaign and working on mitigation at the same time …” Oddly enough, the very scope of Avalanche’s early coordinated attacks may have resulted in the greater ability of the Internet community to neutralize the group’s later efforts.

The Avalanche gang’s infrastructure was briefly shut down in mid November, and ever since then phishing attacks generated by the group have dropped precipitously. Last month, the gang was only able to launch 59 attacks.

Not much is said or written about business identity theft, because businesses can’t technically be the victim of such a theft. But there are a myriad of ways identity theft can impact a business.

Becoming a victim of identity theft is probably the biggest fear of many business owners, since your business credit is often tied to personal credit. It could spell doom for the business if the owner has to be away for countless hours sorting out the attached issues.

Some of the issues a business would face include:

• Loan acceleration. Most small businesses need some sort of loan to get going, buy inventory, rent office space, attend trade shows, provide training, payroll, renting office space or any number of other things. For most businesses, those loans are linked to the owner’s credit. Because of this, before extending any new loans, lenders will check the owner’s credit. If there are any issues, the lender may choose to accelerate the loan, which would mean they want the entire amount back within 30 days.

• Universal default. If a business owner defaults on or is late paying on an account, the lender could require the balance to be paid in full or raise the interest rate to the highest allowed by law. If his personal information has been stolen and a credit card obtained with it, the business owner may not even be aware the stolen card payment is late.

• If a business owner’s Social Security number has been stolen, the IRS may think he makes more money that he’s reporting. That could take a lot of time to clear up.

Dealing with a personal identity theft makes it impossible to focus on your business. And when you add the threat of losing your business on top of losing your good name, it can almost be unbearable.