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ID Theft Scam Hits D.C. Area Residents

4,500 Caught Up In Loss of Data Conned From Firm

By Robert O'Harrow Jr.
Washington Post Staff Writer
Monday, February 21, 2005; Page A01

One of the nation's largest commercial information services said yesterday that thousands of Washington area residents were among those whose personal and financial details were sold to fraud artists apparently behind a nationwide identity theft scheme.

As many as 4,500 residents in the District, Maryland and Virginia were among up to 145,000 people whose names, addresses, Social Security numbers and, in some cases, credit files were electronically shipped by ChoicePoint Inc. of Alpharetta, Ga., to people posing as business officials in the Los Angeles area.

_____Live Discussion_____
Transcript: Reporter and author Robert O'Harrow Jr. answered your privacy questions.
_____Book Review_____
They're Watching You . . . Today, we are constantly tagged, monitored, studied, sorted and tracked by a vast array of institutions and organizations -- private and public. As Robert O'Harrow Jr. details in No Place to Hide, it is worse than we could ever have imagined.
_____Background_____
ID Data Conned From Firm (The Washington Post, Feb 17, 2005)
In Age of Security, Firm Mines Wealth Of Personal Data (The Washington Post, Jan 20, 2005)
_____On the Web_____
ChoicePoint Company Info/Stock Quote

Investigators said they think the number of victims will continue to rise as officials learn more about the scheme. At least one lawmaker on Capitol Hill has called for stiffer regulation of commercial data services. This week, others are expected to push for hearings about the information industry.

To control the damage to consumers and the company, ChoicePoint executives over the weekend decided to announce changes in how they assess their clients and maintain security.

Starting today ChoicePoint will offer victims free credit reports and credit-monitoring services for the next year. ChoicePoint officials said they expect to finish sending out notices by the end of the week. Company officials also said they will curb access to some sensitive information for as many as 17,000 small-business clients, including some lawyers, private investigators and insurance companies, while verifying their legitimacy. Conducting the background checks could take as long as two months, the officials said.

ChoicePoint has become an information giant since it formed in 1997. It has acquired more than 50 other companies and, according to recent figures, has more than 100,000 customers, including most Fortune 500 corporations, local, state and federal law enforcement, and every major federal government agency. The company says it has 19 billion records that are routinely delivered in reports and analyzed for an array of reasons, including fraud detection, police investigations and journalism.

ChoicePoint chief executive Derek V. Smith pledged that his company would go to great pains to revamp its operations in the aftermath of the information scam, in part to reassure consumers that the company cares about the security of their information. He likened identity thieves to "a computer virus" that relentlessly looks for vulnerabilities.

"We want you to know we take this criminal activity, the results of which we are aggressively addressing, very seriously," a company statement said.

Information and privacy specialists said the fallout from the fraud and security breach is only just beginning.

That is in part because ChoicePoint and other information services, such as LexisNexis, are playing increasingly important and sensitive roles as contractors to federal law enforcement, intelligence and homeland security agencies. One of the key issues the commercial services are helping the government to confront in the war on terror is identity fraud and the tendency of terrorists to take advantage of security gaps to hide their true identities.


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