FBI, DOJ investigating major identity theft case
Feb 12, 2013 Dave King
ACH cards and other electronic payments have become popular among the nation's businesses in recent years, as these systems can be used to manage accounts payable and receivable more efficiently and affordably than ever before. However, wire transfers and ACH cards do represent significant risk when not properly managed, especially as hackers and identity thieves continue to target these processes as a means of stealing information and money from unsuspecting victims.
Businesses need to be vigilant when using electronic payments, ensuring strong ID verification processes while keeping a close eye on all accounts payable and receivable. The most devastating instances of identity theft and wire fraud are those that go on for long stretches of time undetected, illustrating the importance of enforcing all oversight policies regularly and thoroughly.
Advanced identity theft strikes
The federal government recently reported that identity thieves successfully stole $200 million through an organized scam that spanned across eight countries and 28 contiguous states. The Federal Bureau of Investigation (FBI) and U.S. Department of Justice (DOJ) recently uncovered the 18-person identity theft ring that was believed to have been active for years.
According to a report from the DOJ, the thieves used a three-step process to ring up the $200 million stolen from numerous commercial entities and businesses. First, the suspects created false identities and associated documentation to formulate fake profiles with several of the major credit reporting agencies in the United States.
Then, the thieves would increase the fake credit profiles using a variety of practices, which made the various reports seem real and in excellent standing. This enabled the defendants to take out enormous loans through the fraudulent identities, which they used as profit and never intended to pay back.
The FBI and DOJ are still investigating this massive identity theft case, and reported that all involved will be put on trial for alleged wire fraud and identity theft. While there are only 18 suspects, the FBI uncovered thousands of unique, fraudulent identities.
ID verification a must
Identity theft continues to become a more widespread and devastating crime, and a wider variety businesses are now at risk than ever before. Companies need to follow the guidance of the Federal Trade Commission (FTC), FBI and other regulators to ensure all ID verification processes are adequate and in line with compliance requirements.
Failure to do so could lead to hurt reputations, lost finances and even crippling sanctions from the various enforcement bureaus should the crime have been made possible by negligence.