Credit Repair Blog

FTC: Identity Theft Continues to be a Big Problem

The report on identity theft, issued by the Federal Trade Commission in December 2008, concludes that nationwide standards need to be adopted for how businesses verify the identity of new and existing customers.  This will make it harder for identity thieves to use social security numbers (“SSNs”) and other stolen, private, information to commit fraud.

“The first step in minimizing the role of SSNs in identity theft is to limit the demand for SSNs by making it more difficult for thieves to use them to open new accounts, access existing accounts, or obtain other benefits or services,” the FTC states in the report. Currently, the only private-sector organizations subject to nationwide authentication standards are financial institutions regulated by the federal banking agencies. The FTC’s report recommends that Congress consider establishing similar standards to cover all private-sector entities that maintain consumer accounts. Such standards would require organizations to adopt reasonable procedures for authenticating customers, but also would allow them to adopt a program that is compatible with their size and the nature of their business, the report states.

The FTC report also recommends that steps be taken to reduce the unnecessary display and transmission of SSNs, but noted that such restrictions must be approached carefully. A number of important functions in the U.S. economy depend on use of and access to SSNs, and the report concluded that overly restrictive attempts to limit the availability of SSNs could unintentionally curtail those functions. Finally, the report recommends steps to improve data security, increase outreach to consumers and businesses on the protection of SSNs, and enhance coordination and information-sharing among organizations that routinely use SSNs.

You can view a copy of the report here.