| September
15, 2000
VIA E-MAIL WITH FIRST CLASS MAIL Secretary Re: Identity Theft Victim Assistance Workshop Dear Secretary: I am writing on behalf of the Office of Enforcement in response to the Federal Trade Commission’s Federal Register Notice seeking comments related to the Public Workshop on Identity Theft Victim Assistance (65 Fed. Reg. 50707 (2000)). First, let me express my thanks to the FTC for hosting this workshop. As you know, the FTC was an integral part of the interagency group that worked with the Department of the Treasury to organize the National Summit on Identity Theft, held March 15-16, 2000 in Washington, D.C. In particular, we appreciate the panel participation of the FTC’s Bureau of Consumer Protection Director Jodie Bernstein, as well as attorneys Beth Grossman and Joanna Crane. The National Summit on Identity Theft fulfilled a Presidential directive to bring representatives of government and industry together to focus on identity theft. The proceedings of the Summit can be found on the Treasury web site at http://www.treas.gov/enforcement/nsit.html. The FTC’s workshop, along with that of the Social Security Administration, will continue the momentum of the Summit to develop comprehensive responses to identity theft and to assist its victims. At the Summit, we heard from just a few of the victims of identity theft. They and too many others have faced the difficulty of trying to recover from violation of their personal reputations and credit records. Again, we thank them for sharing their stories with us. And we look forward to hearing more from identity theft victims at the FTC’s workshop. Their participation will give us real-world examples of how we can all do better in helping them restore their good names. Government at all levels has a responsibility to prevent identity theft and assist in making its victims whole. Federal, state and local governments must review what personal information about their citizens they make available, and how they do so, making sure to halt unnecessary disclosures. For example, many government agencies use social security numbers as identifiers in their own record-keeping, and maintain records of materials provided by private sector entities which include social security numbers and other personal data on individuals. Safeguarding this information from improper disclosure must be a paramount concern, while still allowing the legitimate use of the records for government functions such as statistical analysis, law enforcement, and entitlement program administration. Governments also must devote law enforcement resources to investigating and prosecuting identity theft. The IRS Criminal Division has a hot line number, (800) 829-0433, for taxpayers who believe an identity thief has used their social security number to file a fraudulent tax return. The Secret Service maintains databases on fraudulent checks and credit card "skimming" (electronic collection of credit card numbers), which facilitate investigations of misuse of means of identification. And the FTC’s outstanding work as consumers’ lead agency on identity theft has not only increased education, but also provided a centralized database of consumer complaints, searchable by law enforcement at all levels. Law enforcement forms an important part of the government’s response to identity theft, and our office participates in the Department of Justice’s multi-agency Subcommittee on Identity Theft, ensuring a comprehensive response to this crime. When we successfully prosecute identity thieves, we need to make sure they serve sufficient time in jail. For that reason, we are pleased that the U.S. Sentencing Commission recently proposed changes to the sentencing guidelines used in federal courts. Barring any contrary Congressional action, these changes will become effective in November. The proposals would not only increase overall the penalties for identity thieves, but would also take into account in the sentencing process the harms suffered by victims, not just financially but also in terms of inconvenience. The Department of the Treasury submitted written comments supporting these proposals. Although many agencies are working to combat identity theft, government alone cannot fight this battle. Private sector firms need to install better information controls. It may be expensive, but the cost is little compared to the long term harms to financial institutions from financial crimes – to say nothing of the costs to victims and society at large. Indeed, there are benefits that go well beyond protection of property and avoidance of legal liability. To the extent that customers feel confident their personal information is protected, they will make greater use of a company’s products and services. To the extent they feel the private sector has not responded to this concern, there will be a greater demand for government regulation. There are signs that industry is responding to these concerns. On the eve of the Summit, the Associated Credit Bureaus proposed changes to the ways they do business to respond to identity theft. While the initial language was promising, the true test of these and similar proposals lies in the actual relief they provide to victims and consumers. The FTC’s workshop will be an excellent forum for identity theft victims, the credit reporting bureaus, and credit issuers to review the implementation of the Associated Credit Bureaus’ proposals, and determine whether they have made a real difference in easing the burdens on victims. We hope that industry will go further, by developing standardized consumer affidavits acceptable to all credit reporting agencies and creditors. The burden of repeatedly providing the same information to different entities in different forms is one of the most common identity theft victim complaints. In addition to these government- and industry-specific initiatives, there is much that the public and private sectors can do together. For example, the Secret Service and the financial industry have worked together to develop better information on electronic commerce. The public and private sectors have also worked together on public education campaigns, and those efforts will continue. In conclusion, we welcome this workshop’s discussions of many aspects of identity theft, from prevention, to law enforcement, and other remediation efforts. These are critical issues that require attention at the highest levels of government and the private sector. Working together, we can best provide assistance to identity theft victims. Sincerely, A. Carlos Correa |