Friday, January 9, 2009

The Backside

Dear Madam or Sir:

I am writing this letter in regards to Identity Theft and the impact that it has not only on individuals but on our Nation's economy as a whole. I feel that although Identity Theft has been classified as an epidemic in this country, its full impact has been generally overlooked. If you examine any of the statistics regarding Identity Theft over the course of the past ten years you will immediately realize that the incidence of ID theft is increasing at an exponential rate. While I realize that there are many critical issues which currently face the United States, I do not feel that these issues excuse a complete disregard for what has become the most common form of criminal activity. You may ask yourself why, of all the problems our country faces, I feel it necessary to address the issue of Identity Theft. The reason for this is the most obvious one: I am a victim. I am a victim of what is considered to be the most crippling form of ID theft, Criminal Identity Theft. It is my intention to demonstrate in this letter why I believe that this is a form of crime which must be addressed with the greatest sense of urgency possible.

Everyone is aware of the most common form of ID theft which is Financial Identity Theft. The reason that ID theft has become a household phrase is due to the frequency with which it occurs. If you personally have not been a victim of Identity Theft, I guarantee that someone you know has. If you are in a public place I firmly believe that you could ask ten random individuals if they have been a victim of Identity Theft and that a minimum of five of those individuals will say that they have. This should not only alarm you, it should terrify you.

According to recent statistics from the Federal Trade Commission, at least forty percent of individuals who have credit card accounts have had fraudulent charges made to their accounts or have had new accounts fraudulently opened in their names. This statistic only accounts for the reported incidences with registered complaints. It is thought that the instance of unreported criminal activity is far higher than this. What is the cost to the economy? Add initial monetary loss to time spent repairing the damage, then multiply that by the resulting effect it has on the victims. Also, please bare in mind that the face value cost does not in any way reflect the backside impact to the economy.

I would like to give an example of what I mean by the last statement made in the previous paragraph:

Let's say your name is Bob. Bob has several unsecured (credit card) accounts. The available limits of these accounts totals somewhere in the neighborhood of one hundred thousand dollars. Bob is a responsible consumer who has excellent credit and has relatively low debt. Enter the Financial Identity Thief, let's call him Jon. Jon illegally obtains Bob's personal information (Full name, Date of Birth, Social Security Number). Once this information is obtained Jon opens new accounts and accrues fraudulent charges totaling fifty thousand dollars. This can happen because Bob is a responsible consumer and has a low Debt to Income ratio and a high credit score. Bob becomes aware of the problem, unfortunately at this point the damage is done.

In the above example the initial negative impact is the $50,000.00 in fraudulent charges. The backside cost for which there is no reliable data is potentially far higher.

Firstly, the $50,000.00 in fraudulent debt is considered by a great degree to be an asset for the companies the charges were made with. This is due to the fact that through the great miracle of Corporatism a company's debt can be considered an asset. Doesn't make any sense does it? If you are an individual who is informed when it comes to business or financial practices you already know that what I say is true, never mind the fact that it defies all common sense and logic.

So how does it work? Let us say you are Corporation X. You have 1 billion dollars in unsecured loans to borrowers. On the books this does not register as a billion dollars in unsecured debt. The reason for this is that you are operating under the assumption that these "loans" will be repaid with interest. These payments and interest are considered "income". So in buying stock, supplies, and services you are purchasing based on this "income" which is in actuality debt. If ten percent of your one billion dollars in loans is the result of fraudulent charges, that's one hundred million dollars. Assume that you receive a mean interest rate of twenty percent. If this is the case, Corporation X has been operating and possibly leveraging based on an expected income of twenty million dollars (profit generated from interest on debt) which simply does not exist. In addition to this twenty million dollar "loss", the one hundred million dollars can no longer be considered an asset. It has become what it actually is: a liability or Debt.

As you can see, the negative impact is much more far reaching than the initial loss resulting from the fraudulent charges. These "leveraging" principles are much the same as what is used by housing lenders. With housing lenders the debts are at least asset backed (the homes and property used to secure the loan). Much of the financial crisis we are currently facing stems from the housing sector. If you have a billion dollars in asset backed loans, that's great. However, if the assets (homes and property) have been severely overvalued, it's not so great. This is a completely different subject and I apologize for getting sidetracked.

So the negative impact of the $50,000.00 in fraudulent charges is much greater than the face value of the loss, hopefully at this point that much is obvious. Add to the problems it creates for the lenders the effect the crime has on the victim. If you are Bob, how comfortable are you going to be with having unsecured accounts in the future? Once the immediate financial repercussions have been rectified (if this is even possible), how anxious are you going to be to make purchases in the same manner you did prior to the theft? Factor in the amount of time it takes to remedy the false charges, the mental anguish it creates, and the loss in productivity that inevitably result. You are beginning to get the picture of what I mean when I say the backside. These things which I have discussed so far are all in relation to Financial Identity Theft which is the most common form of Identity Fraud. Now I'm going to discuss the most damaging type of Identity Fraud, Criminal Identity Theft.

Criminal Identity Theft is use of the Identity of someone else to establish a criminal record. In the simplest terms, someone gets arrested as you. There is absolutely no data involving the impact of Criminal Identity Theft on the economy. The reasons for this lack of information will become more evident as I discuss it further.

In 1997 someone was arrested as me. Upon being detained by law enforcement the criminal provided arresting officers with my Identity as his own. The perpetrator was detained, questioned, and then incarcerated as me. I had no prior criminal background and as a result had no identifying characteristics (photographs, fingerprints, or physical descriptors such as tattoos or birthmarks) to use as a comparison. The criminal was held and then released on bond. Upon not appearing in court for the offense a warrant was issued, for me. As far as law enforcement was concerned I had been arrested, detained, and then released. I will get to the financial impacts of Criminal Identity Theft in short order; I simply wished to provide a general understanding of how it happens.

From the date of the arrest until I became aware of the problem almost ten years later there was a warrant for my arrest. I had no knowledge of this simply because I have never been in trouble with law enforcement. I'm certain you can see the potential legal problems this could cause (i.e. false arrest and imprisonment) but are likely wondering how any of this could translate into financial burdens. It took me quite a bit of digging to determine this, allow me to explain the transition in the simplest terms possible.

1. Jon Doe is arrested as you.
2. Arresting agency passes false arrest information to State agency.
3. State agency passes false arrest information to Federal agency.
4. Federal agency sells false arrest information to background providers.
5. Background providers return false background results to perspective employers or creditors.

Step four is where the real problem begins. Once private background providers have the false information there is virtually no way to remove it completely. If you are fortunate enough (or unfortunate enough depending on your perspective) to learn of the Criminal Identity Theft committed against you, your courses of action are limited to say the least. First, you will have to prove your innocence to law enforcement. This in and of itself is problematic. You will have to submit yourself for fingerprinting several times and make repeated attempts with State and then Federal authorities to have the erroneous information corrected. Once you have obtained clearance from Federal authorities there is no guarantee you will be able to get the false charges removed from your actual criminal record. It took a Congressional representative fighting for me even after I had been cleared by the Department of Justice to get my local criminal record cleared. All of this addresses only the criminal repercussions of Criminal Identity Theft, it doesn't even graze the tip of the proverbial iceberg when it comes to all of the other areas this will impact your life.

Even if you are persistent enough to get the various law enforcement databases corrected, you will not be able to get the literally hundreds of background providing companies to amend their databases. This is because the companies that provide background screenings are not regulated or even monitored. Perhaps it's just me, but I feel that hundreds of companies which handle the most private and sensitive information of American citizens should constantly be under extreme scrutiny. I only learned of the Criminal Identity Theft after having been unemployed and desperately seeking work for over a year and a half. By law (the Fair Credit Reporting Act) you are supposed to be notified by a perspective employer or creditor if you are denied employment or credit due to the results of a background check. In my experience this law is largely disregarded. At least in regards to employment, all a perspective employer has to do is state that "The position has been filled." Or that "We have decided not to hire at this time." I have applied to literally hundreds of companies in the past ten years and have only been notified by one that they could not hire me due to the results of my background check.

So there you have it. What is the impact to a society and its economy when an individual who would normally be a productive and contributing member of that society cannot gain employment due to a false criminal background? The answer: The impact is immeasurable. I went from being a relatively well paid employee in a technical field who had nearly perfect credit to what I am today. Today finds me as a part time, minimum wage, soon to be homeless, mentally and emotionally destroyed worker with abysmal credit, massive debt and no foreseeable way of repaying it. I have been unable to gain even the most menial employment despite the fact that I have six years experience in a technical field in addition to four years experience in Retail Management. There are conceivably well in excess of a hundred thousand American Citizens who are victims of Criminal Identity Theft. Due to the nature of the crime and the reluctance of perspective employers and creditors to make the victims aware there is a problem, these victims will never know why they are in such a dire situation. They will likely believe as I did for almost a decade. They will think that they can't gain equitable employment and are starving due to a poor job market, failing economy, or just plain bad luck. The backside…If there were a way to measure the true cost of Identity Theft on our Society it is highly doubtful I would have ever needed to write this letter.

Respectfully Yours.

Cornered Citizen

Tuesday, November 4, 2008

The Me I'm Not

I originally posted this in August 2006. Since then I have gotten clearance from the Department of Justice and nothing has changed. I still am unable to gain equitable employment. I have been stuck in part time minimum wage hell for over a year and a half now. Keep on thinking it can't happen to you.


To whom it may concern,

I wonder how many Americans think that paying their taxes, obeying the law, and working hard will benefit them. I would imagine that the majority of the populous believes that they can work hard and thrive, after all that is the American Dream, is it not? I used to believe in The American Dream. I have been taught that The Dream is just that, a Dream. The reality is that in this country no matter how hard you work and no matter how earnestly you obey the laws (even the ones that are unjust), when it comes down to it you as an American Citizen have less rights and protections than those that are in this country illegally. The wealthy of course are not included in the previous statement as they are above the law. Don't think it is so? Just look at the corporate scandals of the last decade closely.

So there's a little about the American Dream, now let me tell you about the American Nightmare.


I have lived in the United States all my life. I was born here and am a US citizen like most of the rest of the population. I attended public schools and began working at the age of sixteen. Since that time I have worked diligently, paid my taxes religiously, and obeyed the laws of Our Great Nation with the fervor of a devout follower. I ceased watching Television and listening to Radio many years ago. I became disgusted with the commercialism that saturates all media and slowly began to realize the medias effect as well as its purpose.

So basically, barring the fact that I do not participate in the mainstream media circus in this country, I am just like the rest of you. I'm an upstanding American Citizen and this is why I am completely disgusted with our Government and it's apathy towards the people that provide it with its existence. Now comes the nightmare. Imagine opening your mail one day to find that the course of the last ten years of your life has been determined by the actions of someone else. Imagine that the government found it more desirable to protect a criminal than to help you as a law-abiding citizen. Your imagination may not have to help you with this too much, for just as it has for me, it can become your reality very quickly.

I have been unemployed and seeking work for over a year and a half now. I have searched for jobs in other parts of my state as well as other parts of the country. I could not understand why I was unable to find employment. I have always been a hard worker and have experience in several different fields. I became aware as to why I wasn't employable upon opening the aforementioned mail. You see, although I have never committed a crime or been arrested I have a Criminal background that reads like a Mafia Member's rap sheet. How did this happen you ask? It's called Criminal Identity Theft. The government considers my situation "rare" and therefore will offer no assistance in resolving this matter. Let's both take a look now at what has befallen me and could just as easily happen to you, if you're an American Citizen that is. Please don't cease reading this yet as you could find yourselves in my shoes at any moment.

I stated previously that it was a piece of mail that sparked an epiphany, it wasn't a pleasant realization by any stretch. A company that I had recently applied for employment with sent the mail parcel to me. Just as the literally hundreds of employers that I have submitted resumes and letters of recommendation to in the past decade had done this company stated that they couldn't hire me. Unlike all the other companies however, this one did what they are supposed to do according to law. You see, when you are denied employment due to credit or background checks, by LAW you are supposed to be notified BY THE EMPLOYER. Ironically this company is one that I had worked for in the past. They were anxious to rehire me due to my work history with the company and the fact that I was willing to work for a laughable salary. Of course I was willing to work for peanuts, when you're starving peanuts are not only acceptable but also desirable. This company was my last resort and therein lays the irony. My last ditch effort at employment was the one that made me aware of why I have been unable to find equitable employment for almost ten years. According to local, state, and federal authorities I am a criminal.

Since at least 1997 someone has been using my full name, date of birth, and social security number to establish a criminal record. In short they have stolen my identity. This means that the struggle I have had finding a job is due not to a poor job market, not to my work history, not to a lack of effort to seek employment but is instead due to a lack of the Authorities to verify the identity of the person they arrested. In addition to the lack of responsibility the Authorities have taken, ALL of the companies I have applied with that have neglected to inform me they could not hire me due to my criminal background have been equally irresponsible. They have broken the law. I have NEVER been arrested for or convicted of any offense yet I am being penalized. What's wrong with this picture?

I am on the verge of losing my home and everything I own. I have racked up a fair amount of credit debt just trying to survive long enough to get another job. Up until I lost my job last year I had exemplary credit. I have never made a payment late and have never had charged off debt or collection activity. In other words, I have been beyond responsible when it comes to paying my bills. Now I find that I haven't been able to make a decent living because of the actions of a criminal. I have a child whom I have not been able to raise because I lacked the income to pay for litigation. "So there has to be something you can do," you are certainly thinking. Let me tell you a little about what I can do and have done so that you will know if you find yourself in the same situation. And please don't make the mistake of thinking that it can't or won't happen to you, more and more Americans are making that mistake every year. It's a mistake you may unfortunately live to deeply regret.

First I had to submit myself to local authorities for fingerprinting and a background check. Upon doing this I was told that the Authorities know who the criminal responsible for this was, but that until I am cleared through the FBI and removed from the NCIC (National Criminal Information Center) they cannot provide me with his identity. Let me put this in terms you can easily understand. This would be the same as someone robbing you, the police catching them, and then the police telling you that they can't tell you who committed a crime against you for one to three years.

After submitting the fingerprints and clear background check to the State Police I am directed to wait somewhere between thirty and sixty days to be cleared at the state level. Once the charges have been cleared at the state level I have to submit the information to the FBI and wait one to three years to be cleared at the national level. In the meantime the individual who has literally stolen ten years of my life is free (that is assuming that they are not currently incarcerated) to continue to do as they please. In the meantime I am still unable to get a job.

If I want to drive cross-country I will likely have a repeat of something I had the displeasure of experiencing last year. On my way back from the other side of the country last year I was stopped by State Troopers midway through the trip. I was detained, searched, interrogated, and then had to watch my car torn apart as the Authorities looked for non-existent contraband and drugs. I assumed it was harassment due to the fact that I was driving a small sports car with out of state tags, was I ever wrong. If I try to get on an airplane I will likely be detained and questioned and if I try to exit the country the same will apply. So who is thriving here? It seems to be the criminal who can simply steal another identity to get about.

There must be some legal recourse you're thinking. There isn't. Well let me rephrase that, if I were wealthy I would have plenty of legal options. As I stated before I am on the verge of losing everything I own so needless to say I don't have five to ten thousand dollars to drop on a high priced lawyer as a retainer. I have spoken with eight different attorneys and all have said that they would require a minimum retainer of two and a half thousand dollars to assist me. That assistance would only be in clearing my name at the national level and would not involve any monetary compensation. In other words, it's not profitable so we don't want to touch it.

I have spoken with my State Senator on the phone and been told that I am doing everything I can. Gee, thanks Congressman, I feel a lot better now about my tax dollars paying your salary. I have contacted the Federal Trade Commission, Social Security Administration, ACLU, the Privacy Rights Clearinghouse (who petitioned Congress to do something about this particular form of identity theft in 2004), and several other groups and agencies. The general consensus is that without money I am doing everything that can be done currently, all at my expense of course.

Perhaps the biggest insult of all comes in the form of how this will continue to affect me even once I have been cleared at the National level. For the rest of my life (that is assuming I can continue to stomach living in this country) I will have to report to the Authorities once a year. I will have to be fingerprinted and have a background check performed. Upon being cleared I will be issued documentation that I have to carry on my person AT ALL TIMES. Also, once the information is cleared from my record there is no guarantee that the Data will not once again be merged. In addition, the documentation will not prevent harassment by Police or other law enforcement agencies. After all, if they can't be bothered upon booking and incarcerating a criminal to verify their identity they're certainly not going to do much better with a routine traffic stop.

So in closing I leave you with this thought: In this country the only way to be safe from Identity Theft is to NOT be a US Citizen. If you are here illegally you can't have your identity stolen because you don't exist in the system. If you are here illegally you don't have to pay taxes to an entity that operates outside the law. If you are here illegally you have a better chance of getting medical treatment than an impoverished US Citizen. In short, if you're here illegally you are smarter than the eighty percent of the population that unwittingly hovers just above the poverty level.

God Bless America.