Who Commits the Crime

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Who Commits the Crime

Perpetrators committing identity crime often include those whom victims trust, including family and friends, and/or those who have access to their information through other legitimate relationships.

Service providers Those to whom individual victims or companies who possess their personal information freely offer it on false pretenses or during another transaction Those who steal information through use of both low-tech and high-tech means
  • Home health aides
  • Auto dealers
  • Employees of financial institutions
  • Professionals:
    • Doctors
    • Accountants
    • Lawyers
    • Other
  • Employers
  • Security guards
  • Pretext phone scammers
  • “Phishing” scammers
  • Advance fee scams
  • “Work at home” scams
  • Waiters, cashiers, desk clerks
  • Hijackers of legitimate social networking or employment Web sites
  • Network intrusions
  • Thieves and burglars
  • “Dumpster divers” (usually those who “hit” business dumpsters, such as hospitals, mortgage brokers, video rentals, etc.)
  • Social engineering (access to business records)
  • “Down streaming” (intercepting data during download)
  • “Skimming” ATM and credit cards

Within identity crime organizations, there are some patterns. “Hub and Spoke” model provided below will help explain the organization of criminal enterprise in identity crimes (created by Sgt. Stephen Jensen of the Identity Crime Unit at Suffolk County (NY) Police Department):

In this model, the “suppliers,” “converters” and “passers” have unique and connected roles:

Who? Suppliers: Gather stolen personal information [S] Converters: Create new forms for using stolen identities [C] Passers: Use the converted data to obtain goods, services or cash [P]
How?
  • Theft of personal identifiers
    • Mail
    • Trash
    • Employee files
    • Burglaries
  • “Skimming” credit/ debit cards
  • “Phishing”
  • Cloned credit/ debit cards
  • Forged Social Security cards
  • Forged driver licenses or other government-issued IDs
  • Use cloned credit/debit cards for purchases and withdrawals
  • Open new accounts, such as wireless and credit card accounts
  • Purchases
  • Forged passports, licenses etc., for criminal concealment/ terrorism
  • Use of forged identities as straw buyers and sellers in home or vehicle purchases
  • Use for obtaining medical insurance or government benefits
Characteristics of Criminal Enterprises

Often in organizations depending on several individuals, the actors will erect “Chinese walls” or a division of labor which separates the perpetrators and cloaks the various parts of the enterprise in anonymity, usually designed to protect the larger whole in case one “spoke” is compromised by law enforcement.

Anonymity may be set up through:

  • Internet communications and data transfers
  • Continuous employment of new recruits in “spoke” operations that have little knowledge as to organization or members and are usually paid for work in cash.
  • Sub-contracting part of the enterprise to smaller informal organizations.
  • Use of mail drops and merchandise drops.
Various Sizes of Criminal Organizations
Single individual

Involved in every facet of the enterprise, he/she obtained the personal identifiers, plans the use of the identifiers and obtains goods, services or cash, etc.

  • Usually involves an opportunistic access to personal data:
    • Family
    • Friends
    • Home health aides
    • In-home service contractors
    • Finders of lost wallets, purses, etc.
  • May involve a more organized individual who places himself in a position to gain access to personal identifiers:
    • Security guards
    • Employees of merchants
    • Waiters
    • Gas station attendants
A small group of actors
  • Division of labor based on “hub” and “spoke,” may be shared by members
  • Organizational leader
  • Formal
  • Informal
Highly sophisticated and/or complex organization (many individuals)
  • May be based on a division of labor
  • Often used in money laundering

Organized identity crimes may be instrumental to or involve other crimes including:

Government/Vital Document Fraud

Federal raids in 2006 at meat-processing plants owned by Swift & Co. in six states resulted in the arrests of 1,282 people for immigration violation, with 65 also charged with identify theft or other criminal charges.

Drug Trafficking

The National Association of Counties reports that methamphetamine-related identity crimes increased from 27% to 31% between 2005 and 2006.9

Weapons Trafficking

Identity crime is a serious problem for those working to stop illegal gun trafficking. “Lying and buying,” schemes make identity theft a critical element in weapons trafficking. Firearm purchases made under a false identity (either fictitious or stolen) enable traffickers to completely escape detection when the gun is used or sold in commission of a crime.

Wire Fraud

In March, 2008 Luis Uribe pleaded guilty to single counts of wire fraud and aggravated identity theft in what prosecutors are calling a mortgage scheme that resulted in more than $6 million in fraudulent loans. Uribe faces up to 30 years in prison and a $1 million fine.

He was one of the principals behind Bay General Contracting Services LLC, a non-licensed contracting service firm where Uribe reportedly used his mortgage broker license to obtain 32 loans under false pretenses. He then disbursed the proceeds of those loans into bank accounts in his control.

Although "numerous" notices of commencement were filed with clerks in Hillsborough, Pinellas, Pasco and Citrus counties, no construction work was actually done. Bay General never hired any employees and brought in no one to work on the projects it had obtained loans for. Prosecutors said that Bay General was used to improperly inflate the value of properties being bought, to strip actual and fraudulently created equity out of properties and to serve as a vehicle for "siphoning the proceeds" from fraudulently obtained loans http://tampabay.bizjournals.com/tampabay/stories/2008/03/24/daily46.html.

The case was investigated by the Tampa Police Department and the FBI.

Terrorism

The 9/11 Commission Report highlights the urgency of preventing and responding to identity crimes as a crucial instrument in combating terrorism. "Travel documents are as important as weapons," the report says. "Fraud is no longer just a problem of theft. At many entry points to vulnerable facilities, including gates for boarding aircraft, sources of identification are the last opportunity to ensure that people are who they say they are."10

In addition to using false identities to facilitate travel, terrorists are often financing operations through stolen credit. A global terrorist cell based in the United Kingdom used credit card information stolen via phishing attacks and laundered money through on-line gambling sites to finance Web sites "promoting martyrdom through terrorist violence," according to British press reports.

Credit card information was put on the black market, which the terrorist cell eventually used to establish a network of Web sites that enabled communications among terrorists. The sites also provided information on such topics as computer hacking and bomb-making and hosted videos of beheadings and suicide bombings in Iraq. In 2007, three men – Waseem Mughal, Younis Tsouli and Tariq al-Daour – were sentenced to jail terms for encouraging others to commit acts of terrorism.11

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Who Commits the Crime

Perpetrators committing identity crime often include those whom victims trust, including family and friends, and/or those who have access to their information through other legitimate relationships.

Service providers Those to whom individual victims or companies who possess their personal information freely offer it on false pretenses or during another transaction Those who steal information through use of both low-tech and high-tech means
  • Home health aides
  • Auto dealers
  • Employees of financial institutions
  • Professionals:
    • Doctors
    • Accountants
    • Lawyers
    • Other
  • Employers
  • Security guards
  • Pretext phone scammers
  • “Phishing” scammers
  • Advance fee scams
  • “Work at home” scams
  • Waiters, cashiers, desk clerks
  • Hijackers of legitimate social networking or employment Web sites
  • Network intrusions
  • Thieves and burglars
  • “Dumpster divers” (usually those who “hit” business dumpsters, such as hospitals, mortgage brokers, video rentals, etc.)
  • Social engineering (access to business records)
  • “Down streaming” (intercepting data during download)
  • “Skimming” ATM and credit cards

Within identity crime organizations, there are some patterns. “Hub and Spoke” model provided below will help explain the organization of criminal enterprise in identity crimes (created by Sgt. Stephen Jensen of the Identity Crime Unit at Suffolk County (NY) Police Department):

In this model, the “suppliers,” “converters” and “passers” have unique and connected roles:

Who? Suppliers: Gather stolen personal information [S] Converters: Create new forms for using stolen identities [C] Passers: Use the converted data to obtain goods, services or cash [P]
How?
  • Theft of personal identifiers
    • Mail
    • Trash
    • Employee files
    • Burglaries
  • “Skimming” credit/ debit cards
  • “Phishing”
  • Cloned credit/ debit cards
  • Forged Social Security cards
  • Forged driver licenses or other government-issued IDs
  • Use cloned credit/debit cards for purchases and withdrawals
  • Open new accounts, such as wireless and credit card accounts
  • Purchases
  • Forged passports, licenses etc., for criminal concealment/ terrorism
  • Use of forged identities as straw buyers and sellers in home or vehicle purchases
  • Use for obtaining medical insurance or government benefits
Characteristics of Criminal Enterprises

Often in organizations depending on several individuals, the actors will erect “Chinese walls” or a division of labor which separates the perpetrators and cloaks the various parts of the enterprise in anonymity, usually designed to protect the larger whole in case one “spoke” is compromised by law enforcement.

Anonymity may be set up through:

  • Internet communications and data transfers
  • Continuous employment of new recruits in “spoke” operations that have little knowledge as to organization or members and are usually paid for work in cash.
  • Sub-contracting part of the enterprise to smaller informal organizations.
  • Use of mail drops and merchandise drops.
Various Sizes of Criminal Organizations
Single individual

Involved in every facet of the enterprise, he/she obtained the personal identifiers, plans the use of the identifiers and obtains goods, services or cash, etc.

  • Usually involves an opportunistic access to personal data:
    • Family
    • Friends
    • Home health aides
    • In-home service contractors
    • Finders of lost wallets, purses, etc.
  • May involve a more organized individual who places himself in a position to gain access to personal identifiers:
    • Security guards
    • Employees of merchants
    • Waiters
    • Gas station attendants
A small group of actors
  • Division of labor based on “hub” and “spoke,” may be shared by members
  • Organizational leader
  • Formal
  • Informal
Highly sophisticated and/or complex organization (many individuals)
  • May be based on a division of labor
  • Often used in money laundering

Organized identity crimes may be instrumental to or involve other crimes including:

Government/Vital Document Fraud

Federal raids in 2006 at meat-processing plants owned by Swift & Co. in six states resulted in the arrests of 1,282 people for immigration violation, with 65 also charged with identify theft or other criminal charges.

Drug Trafficking

The National Association of Counties reports that methamphetamine-related identity crimes increased from 27% to 31% between 2005 and 2006.9

Weapons Trafficking

Identity crime is a serious problem for those working to stop illegal gun trafficking. “Lying and buying,” schemes make identity theft a critical element in weapons trafficking. Firearm purchases made under a false identity (either fictitious or stolen) enable traffickers to completely escape detection when the gun is used or sold in commission of a crime.

Wire Fraud

In March, 2008 Luis Uribe pleaded guilty to single counts of wire fraud and aggravated identity theft in what prosecutors are calling a mortgage scheme that resulted in more than $6 million in fraudulent loans. Uribe faces up to 30 years in prison and a $1 million fine.

He was one of the principals behind Bay General Contracting Services LLC, a non-licensed contracting service firm where Uribe reportedly used his mortgage broker license to obtain 32 loans under false pretenses. He then disbursed the proceeds of those loans into bank accounts in his control.

Although "numerous" notices of commencement were filed with clerks in Hillsborough, Pinellas, Pasco and Citrus counties, no construction work was actually done. Bay General never hired any employees and brought in no one to work on the projects it had obtained loans for. Prosecutors said that Bay General was used to improperly inflate the value of properties being bought, to strip actual and fraudulently created equity out of properties and to serve as a vehicle for "siphoning the proceeds" from fraudulently obtained loans http://tampabay.bizjournals.com/tampabay/stories/2008/03/24/daily46.html.

The case was investigated by the Tampa Police Department and the FBI.

Terrorism

The 9/11 Commission Report highlights the urgency of preventing and responding to identity crimes as a crucial instrument in combating terrorism. "Travel documents are as important as weapons," the report says. "Fraud is no longer just a problem of theft. At many entry points to vulnerable facilities, including gates for boarding aircraft, sources of identification are the last opportunity to ensure that people are who they say they are."10

In addition to using false identities to facilitate travel, terrorists are often financing operations through stolen credit. A global terrorist cell based in the United Kingdom used credit card information stolen via phishing attacks and laundered money through on-line gambling sites to finance Web sites "promoting martyrdom through terrorist violence," according to British press reports.

Credit card information was put on the black market, which the terrorist cell eventually used to establish a network of Web sites that enabled communications among terrorists. The sites also provided information on such topics as computer hacking and bomb-making and hosted videos of beheadings and suicide bombings in Iraq. In 2007, three men – Waseem Mughal, Younis Tsouli and Tariq al-Daour – were sentenced to jail terms for encouraging others to commit acts of terrorism.11