Joplin, MO Business Blog

Identity Theft

I took some time out today to look at the August 2007 edition of Good Housekeeping.  Good Housekeeping had an interesting article in it about identity theft.  It was not about your usual credit card and shopping spree theft but about medical identity and social security identity theft or fraud.    Medical identity theft occurs when someone else uses your identity when having medical treatment and this treatment becomes a part of your medical records and the costs of said treatment are charged to you.  An example would be someone who is tested for HIV and uses your identification information.  The HIV test comes back positive.  This positive test goes into your medical records and your insurance company has access to it and uses it against you to prevent re-insuring you, or a future employer looks at it when considering hiring you and determines that you are too much of a risk with HIV.    Once these false medical records are put into your files, it is very difficult to delete them or have them corrected.  Part of the problem seems to be the HIPAA regulations which prevent others from reviewing the records without authorization.  Many medical providers will not let the victim review the files of the person committing the fraud.   

What can you do to help prevent the medical identity fraud?  Good Housekeeping suggests the following:

*Protect your insurance card as carefully as your credit cards.  If it gets lost or stolen, alert your insurance company immediately and request a new number.

*Be selective about where you get care.  Avoid clinics that advertise free exams; they may just want to copy your health insurance information.

*Carefully read over the explanation-of-benefits notices that your insurance company provides.  Make sure you recognize the doctor's names and the dates of treatment - an unfamiliar provider is a big warning sign.  If you rarely see your doctors, call your insurance carrier and ask for an annual summary of all procedures that were paid in your name.

The other identity theft or fraud mentioned in the article is your social security number.  According to Good Housekeeping, the Social Security Administration receives millions of earning reports where the name does not match the social security number.  Sometimes this occurs legitimately, such as a woman who gets married and takes her husband's surname but then fails to notify the Social Security Administration.  Other times it is because of fraud and the perpetrator rarely is caught.  The Social Security Administration rarely investigates any discrepancies in unmatched names and social security numbers but places the suspect documents is a "suspense file" and leaves it there.  This social security number fraud happens not only to adults but also to children or deceased persons.  This type of fraud is also hard to correct, especially for children.  The Social Security Administration will not issue a new number unless the victim "continues to be disadvantaged by using the original number."  Apparently children are not disadvantaged when their numbers are used by others. 

To protect yourself from social security identification theft or fraud, Good Housekeeping suggests the following:

*Use a credit monitoring service (roughly $11 per month), which notifies you within 24 hours if there's unusual activity.  Identity theft expert Frank W. Abagnale, author of Catch Me If You Can and Stealing Your Life, recommends PrivacyGuard, Equifax Credit Watch, and Identity Guard.

*Before you toss sensitive financial documents and those credit card solicitations that come in the mail, destroy them in a micro-cut shredder.

*Don't give out your SSN freely.  'There's no reason the storage center or the dog pound needs to know your number,' says Abagnale.

*Never answer unsolicited phone or e-mail messages about your accounts, even if they sound or look legitimate.

It is a good article.  I suggest you read it.

Source:  The ID Theft - You Haven't Heard of . . . Yet by Amy Engeler, Good Housekeeping, August 2007

Can You Defend Your Business Under the 'Castle Doctrine?'

Missouri's Governor Blunt has signed Senate Bill 62, better known as the "Castle Doctrine."  This bill allows persons to justifiably defend themselves without fearing criminal prosecution or civil suits.  I have posted a more detailed article on this bill and the questions the bill doesn't answer on my criminal law blog.  To read more, go to 'Castle Doctrine' Signed by Gov. Blunt.

Women and Crime

In the April.May 2007 edition of Pink magazine there is an article that addresses the progression of women committing more crimes as they move up in the workplace.    The FBI reports that embezzlement by women increased 80.5 percent from 1993 to 2002 and that the total number of women incarcerated increased 138 percent from 1994 to 2004.  This seems surprising to some people because of the belief that women are more ethical than men.  However, women may not be more ethical than men.  A study conducted by Rita Simon, Ph.D., professor at American University's School of Public Affairs and College of Law in Washington, D.C., studied women and crime and argued that as women move up in the workplace their likelihood to embezzle or commit fraud increases.  Women are not more ethical than men, they just didn't have the same opportunities in the past to commit these types of crimes as men were the ones in charge.

In 1995 women in corporate officer positions at the top 500 American companies was about 8.7 percent.  This increased to 16.4 percent in 2005.  In 2005 women accounted for approximately 45 percent of arrests for forgery and counterfeiting, fraud and embezzlement.   These crimes are costly.  According to the Association of Certified Fraud Examiners:

In 2002, fraud cost corporations 6 percent of their total revenue, or $600 billion.

Executives are 16 times more likely than employees to commit fraud.

About 42 percent of corporate victims recover nothing.  About 23 percent recover less than one quarter of their losses.

Small companies endure disproportionate losses from embezzlement.

Some of the more well-known names of women who have committed crimes and have been held accountable or charges are pending include: 

• Rebecca Hauck -former executive assistant who scammed an estimated $15 million from unwary homeowners with her co-conspirator Matthew Cox.  She was charged with bank and wire fraud, identity theft, money laundering and conspiracy and is serving a 6 year prison sentence, owes $1.2 million in restitution and proceeds from any potential book or movie deal.
• Lea Fastow (wife of Andrew Fastow) - Enron's former assistant treasurer  who has served a 1 year prison sentence for tax fraud.
• Cheryl I. Lipshutz - former CFO of Enron Energy Services  who was charged with violating anti-fraud laws and who has agreed to return $27,150 and pay a fine of $25,000.
• Kathleen M. Lynn - senior vice president of Enron International, also charged with violating anti-fraud laws.  Her case is pending.
• Wendy Feldman - former Rancho Santa Fe stockbroker who deposited clients' checks and wire transfers directly into her own accounts and forged client signatures.  Feldman cooperated with prosecutors and was sentenced to just over 2 years in prison and  restitution of $4.2 million.
• Linda Schrenko - first woman elected to statewide office in Georgia and the first to be convicted of money laundering and conspiracy.  After a plea of guilty she was sentenced to serve 8 years at the Tallahassee Federal Women's Prison.
• Joya Williams - former administrative assistant to the director of Coca-Cola's global brand marketing.  Williams was found guilty of attempting to sell trade secrets to arch rival PepsiCo and faces up to 10 years in prison.
• Patricia Dunn - board chairwoman of Hewlett-Packard, charged with identity theft and fraud charges surrounding Hewlett-Packard's secret efforts to expose board members who were talking to the press.  She has pleaded not guilty and is awaiting trial.
• Martha Stewart.

It will be interesting to see if this trend continues.

Source:  ladies in lockdown by Mickey Goodman, PINK, April.May 2007