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Employers Beware of Identity Theft Employees

Aug 6, 2008
The crime of identity theft by employees is reaching record numbers, maybe because of a heightened awareness of the crime, or progress made by many states in detecting this crime as well as enforcing stricter penalties. Consumers are not the only ones who can benefit from the awareness of how easy and common the practice of identity theft is. Employers also need to be aware of the threats to their business when employees are able to take advantage of access to personal information and use it to commit identity theft.

Important Facts Employers Should Know about Identity Theft:

The number one source of identity fraud involves the theft of employee records.

A recent study by Michigan State University revealed that over 50% of identity thefts occur in the workplace.

The majority of identity theft is committed by employees hired to perform low-level tasks, such as data entry.

90 percent of these crimes involve payroll or employee records.

10 percent of these crimes involve customer information.


Pizza Hut

A number of complaints in Ebensburg PA, about unauthorized purchases were made and upon investigation, police found one common denominator among the identity theft victims. All of the victims had used a credit card in the Ebensburg Pizza Hut within one month. A thirty-year-old employee of the Pizza Hut was charged with making $6,700 worth of internet purchases using bankcard numbers and names of Pizza Hut customers, as a result of their access to this information. The thief was charged with seven counts of each identity theft, access device fraud, and theft by unlawful taking, theft by deception and receiving stolen property.

Police have encouraged all patrons of this restaurant check their statements carefully, as they could have been victims and not even know it. Similar events were also investigated and linked to a Subway restaurant in the Pittsburg area. Dinner out can really be expensive, especially when using your credit card, maybe we should all think about paying cash next time.

Southeast Missouri State University

A former Southeast Missouri State University employee downloaded over 800 student's names and social security numbers. Although there is no evidence that the social security numbers had been used to apply for credit at least two had been used in an attempt to log into student accounts. Students are being advised to obtain fraud alerts and security freezes on their accounts. The former employee, a hall director, was indicted on two charge of identity fraud and one charge of computer trespass.

"In Georgia, unauthorized possession of such data is a felony. In Georgia you don't have to show the person used the data in any inappropriate way. Possession is enough," said Dr. Dennis Holt, vice president for administration and enrollment management.

Employers, did you know that the Fair and Accurate Credit Transaction Act hold employers responsible for these crimes? Any employer whose action or inaction, leads to breach of employee information can be fined by state and federal governments and can be sued in civil court. Class action lawsuits can be brought against employers for both actual and punitive damages.

These stories are just a few examples of what can happen with employers do not properly screen, train and monitor employees to protect their businesses and their customers. It is important to be aware of state laws for possessing, using and even disposing of customer's personal information. Companies can be held liable for their employee's actions that put people at risk for identity theft, even it an identity theft hasn't occurred, as is the case in Georgia and as Radio Shack and other companies found out in Texas, when employees threw credit applications in the trash; applications which held all the information needed to commit identity theft. It is important that businesses be informed, proactive and vigilant in training, screening and monitoring their employees in an effort to protect your customers, other employees and your business.
About the Author
Lisa Carey is a contributing author for
Identity Theft Secrets: prevention and protection
. You can get tips on Identity theft protection, software, and monitoring your credit as well as learn more about the secrets used by identity thieves at the Identity Theft Secrets blog.
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