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March 2005 might make history as the apex of identity theft disclosures. Privacy invasion outfit ChoicePoint, payroll handler PayMaxx, Bank of America, Lexis Nexis, several universities, and a large shoe retailer called DSW all lost control of sensitive data concerning millions of people.

Credit card and other banking details, names, addresses, phone numbers, Social Security numbers, and dates of birth have fallen into the hands of potential identity thieves. The news could not be worse.

In March 2005 alone:

California State University at Chico notified 59,000 students, faculty, and staff that their details had been kept on a computer compromised by remote intruders. The haul included names, addresses and Social Security numbers.

Boston College notified 120,000 of its alumni after a computer containing their addresses and Social Security numbers were compromised by an intruder.

Shoe retailer DSW notified more than 100,000 customers of a remote break-in of the company's computerized database of 103 of the chain's 175 stores.

Privacy invasion outfit Seisint, a contributor to the MATRIX government dossier system, now owned by Reed Elsiver, confessed to 32,000 individuals that its Lexis Nexis databases had been compromised.

Privacy invasion outfit ChoicePoint confessed to selling the names, addresses and Social Security numbers of more than 150,000 people to criminals.

Bank of America confessed to losing backup tapes containing the financial records of 1.2 million federal employees.

Payroll outsourcer PayMaxx foolishly exposed more than 25,000 of its customers' payroll records on line.

Desktop computers belonging to government contractor Science Applications International Corp (SAIC) were stolen, exposing the details of stockholders past and present, many of them heavy hitters in the US government, such as former Defense Secretaries William Perry and Melvin Laird, former CIA Director John Deutch, former CIA Deputy Director Bobby Ray Inman, former Chief Weapons Inspector in Iraq David Kay, and former chief counter-terror advisor General Wayne Downing.

Cell phone provider T-Mobile admitted that an intruder gained access to 400 of its customers' personal information.

George Mason University confessed that a remote intruder had gained access to the personal records of 30,000 students, faculty, and staff.

Par for the course

While this is nothing new, there is an important observation here that's worth emphasizing: none of these cases involved online transactions.

Many people innocently believe that they're safe from credit card fraud and identity theft in the brick and mortar world. Nothing could be farther from the truth. The vast majority of incidents can be traced to skimming, dumpster diving, and just plain stupidity among those who "own" our personal data.

Only a small fraction of such incidents result from online transactions. Every time you pay by check, use a debit or credit card, or fill out an application for insurance, housing, credit, employment, or education, you lose control of sensitive data.

In the US, a merchant is at liberty to do anything he pleases with the information, and this includes selling it to a third party without your knowledge or permission, or entering it into a computerized database, possibly with lax access controls, and possibly connected to the Internet.

Sadly, Congress's response has been to increase the penalties for identity theft, rather than to regulate access to, and use of, personal data by merchants, marketers, and data miners. Incredibly, the only person with absolutely no control over the collection, storage, security, and use of such sensitive information is its actual owner.

For this reason, it's literally impossible for an individual to prevent identity theft and credit card fraud, and it will remain impossible until Congress sees fit to regulate the privacy invasion industry. ®

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ID theft hits 10m Americans a year

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