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ID Theft New Face of Crime
Bank accounts, plastic
falling prey to hackers

By WILLIAM SHERMAN
Daily News Staff Writer

The key is your mother's maiden name.

Once computer hackers and other new-age thieves have that, they're halfway home to 
successfully cloning your identity  and stealing a stash of cash in your name.

The other half  the rest of your identity  is easier to obtain: your Social Security 
number, date of birth and, of course, your name.

"With that, they're golden," said Adam Zion, the Internet crimes expert at the 
Brooklyn district attorney's office. "Then they start 'banging.'"

As thieves gain access to information about your credit card accounts, tax refunds, 
mortgages and financial transactions and transfers, it's a nightmare for you  and big 
losses for merchants, banks that issue credit cards and even credit card companies.

Computer hackers now have the technology and tools to retrieve enough information from 
personal tax and finance programs to file a phony tax return in your name and get an 
IRS refund.

"Once they're in, once they get past the [computer] firewalls, they can get pretty 
much what they want," said William Chan, vice president of computer security firm 
Foundstone Inc.

The Federal Trade Commission announced recently that identity theft is one of the 
fastest-growing crimes, and the leading consumer complaint reported in 2001.

The identities of more than 400,000 people are stolen each year, according to the FTC. 
More than 86,000 have reported such thefts last year.

Although the annual take from sophisticated forms of ID theft is difficult to 
calculate  in part because hard-hit credit card companies are mum on fraud figures  
credit card fraud alone amounts to more than $9 billion annually, according to 
Meridien Research of Newton, Mass.

The Stealing Multiplies

Credit card fraud is not all there is.

With your mother's maiden name in hand, crooks can open debit accounts or bank 
accounts in your name, transfer money from your bank account and even use your credit 
for a range of deals, from mortgaging a house to leasing expensive manufacturing 
equipment.

Scam artists also can make calls on your telephone, obtain a driver's license or 
Social Security card, and claim fraudulent tax returns or government benefits.

The identity fraud boom is fueled by advances in online computer software and 
technology.

Hacking programs and break-in software are readily available on the Internet, says 
Detective Sgt. James Dowd of the NYPD's computer investigations and technology unit.

Thieves set up cutout, or third-party, addresses, post office boxes or sites on the 
Internet for your new address.

"They can get a mortgage in your name and sell your house in your name  and they have 
done it," said Dowd, adding that such hustles often are timed to be completed before 
you find out and report the damage.

In cases of fraud, individual credit card holders' liability is limited to $50. The 
rest is generally absorbed by the merchants who sold goods to the thieves, and the 
banks that issued the credit cards.

Spokesmen for the major credit card companies say they have numerous anti-fraud and 
anti-hacking systems, and they are developing more to combat ID theft.

But in the end, the cost of fraud is passed along to consumers as part of the cost of 
doing business, say enforcement officials.

Your ID Is Everywhere

And that brings us back to your mother's maiden name.

"Think about how often that name is requested in dealing with credit card firms, or 
when you go to a doctor's office and fill out new patient information," Zion said.

"Go on Internet merchants' sites and there's often a menu asking, 'Which questions do 
you want to be asked' and there it is, 'mother's maiden name,' along with the other ID 
items."

Your identification information is in dozens of places: employers' personnel files, 
bank accounts, credit reports, scores of financial transactions and  often, least 
secure  in your home computer or Internet Web sites.

That makes it ever easier for hackers and other ID scam artists to become you.

One maintenance worker at a city Health Department office allegedly accessed the 
personnel records of numerous employees. Then, investigators say, the worker ran up 
$40,000 in credit card bills in their names at various department stores over more 
than 3 years.

Some scam artists actually duplicate your credit cards, right down to the magnetic 
tape.

"They get a bank card in your name, and they'll hit an ATM terminal after 11:30 p.m. 
at the end of the banking day so they can take out the maximum, and then hit it again 
just after midnight with a new day," said Robert Weaver, assistant special agent in 
charge of the Secret Service's New York office.

Major-League Hackers

It's the big-time, high-tech hackers who are the most dangerous.

They endlessly scan Internet provider addresses until they find an opening in a 
process known as "port scanning."

"They have password-cracking programs that will run through every word in the 
dictionary, and in addition will add a number, like 1 or 2, to each word, so that if 
your password is apple1, they will get it," Chan said.

"Or, they can send out 'Trojan horses,' attachments to e-mail that will enable them to 
get in," he said.

Some hackers have used information from finance and tax programs to buy hundreds of 
thousands of dollars worth of computer components, and in at least one case, lease 
garment manufacturing machinery  only to disappear.

Or they can simply transfer money from your bank account to a phony account in another 
location or country, Chan explained.

"By the time you've figured it out, your money is in some bank in Russia or Europe," 
Zion said

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