A Legislative Perspective on the Kentucky General Assembly with State Representative Rick Rand
FRANKFORT – If identity theft still seems like a relatively rare crime when compared to other types of stealing, the truth is that it plays a much bigger role than one might think.
According to a report last December by the federal Bureau of Justice Statistics, it was responsible for nearly $25 billion in financial losses nationwide in 2012, which was $10 billion more than all other property crimes combined.
While we often know immediately when someone has broken into our homes or taken our belongings, identity theft can be much harder to detect. We may not be aware until contacted by a financial institution, and in some cases, young children who are targeted may not find out until they are adults. A 2012 study estimated that this affects at least 2.5 percent of households with underage children.
Overall, the Bureau of Justice Statistics says about one in 16 adults are victims of identity theft. About half lose $100 or less, but 15 percent lose $1,000 or more. Nearly all have no idea who stole from them, but most are able to fix the issue in a day or less. About 10 percent, however, need a month or longer.
This crime’s impact, of course, extends beyond private citizens. In November, for example, the IRS estimated it issued $4 billion in fraudulent tax refunds in 2012, including 655 that went to a single address in Lithuania.
Perhaps the most common stories we hear about identity theft come in the wake of announcements like Target’s late last year, when it estimated that information on 40 million credit and debit cards had been stolen.
State and local governments can be just as vulnerable. A December report by the state auditor’s office noted that, in South Carolina, a single employee who fell victim to an email scam accidentally caused a data breach affecting more than three million people and 700,000 businesses. It took a month before the problem was discovered, and to help compensate for the headaches this caused, that state offered free identity theft prevention and credit monitoring for a year to everyone at a cost of nearly $30 million.
Cyber attacks happen here in Kentucky, too. The auditor’s report noted that one fiscal court lost more than $400,000 from a payroll account as a result of this in 2009; and in 2007, county clerks saw much of their computers temporarily shut down because many had become infected with a virus.
The state is taking steps to help counteract these problems. During this year’s legislative session, the General Assembly passed two related laws that lay out exactly what businesses, schools and local and state governments must do if personal information they possess is compromised. That understandably includes contacting those affected and, if the breach is large enough, consumer credit agencies. For schools and government, officials trained in these types of cases will be involved as well.
Late last year, meanwhile, the state’s Department of Financial Institutions formed a new task force that is working to detect and respond to cybercriminal activity. Its goal is to preserve the integrity of Kentucky’s financial system and those who depend on it.
In today’s connected world, we may be limited in just how much control we have over our personal and financial data, but the need to protect ourselves is more critical than ever.
Be careful if you receive suspicious emails, stay up-to-date with cybersecurity measures, monitor your credit reports and shred any documents that could be used to steal your identity.
If you find you are a victim, our financial institutions and local and state law enforcement are well-equipped to help you get back on your feet. The Federal Trade Commission can also be a resource; its website on this issue is www.idtheft.gov, and it can be reached toll-free at 1-877-IDTHEFT. The state’s Attorney General’s website, www.ag.ky.gov, offers guidance as well.
If you have any questions about what the state is doing in this or any other area, please feel free to contact me. My address is Room 366B, Capitol Annex, 702 Capitol Avenue, Frankfort KY 40601; or you can email me at [email protected] To leave a message for me or for any legislator, call toll-free at 800-372-7181. For those with a hearing impairment, the number is 800-896-0305.
I hope to hear from you soon.