By Michelle Singletary
Washington Post Staff Writer
Wednesday, February 9, 2011; 7:42 PM
There's some good news and some bad news about identity theft.
The good news is that last year the number of people victimized decreased 28 percent, to 8.1 million, according to a report by Javelin Strategy & Research. Although that's still a huge number, it's 3 million fewer victims than in 2009. Overall losses from identity fraud also fell last year, to $37 billion, from $56 billion in 2009.
Using stolen Social Security numbers or credit cards and other financial information, identity thieves, among other crimes, buy cars, get cellphones and open new credit card accounts.
For eight years, Javelin has been tracking trends in identity theft, helping to keep a national focus on this category of crime. Last year, the plummet in the crime was the largest annual decrease since Javelin started tracking it in 2003.
So, what's different?
For one thing, there has been a significant drop in data breaches, or situations in which batches of personal information have become vulnerable to identity thieves. The number of breaches last year was down by almost one-third, to 407 incidents, or 26 million records exposed, according to the DataLossDB project. Again, still a huge number, but at least it's down - from 604 breaches, or 221 million records exposed, in 2009.
"We definitely see evidence that the banks and other institutions are taking stronger precautions to prevent data breaches," said James Van Dyke, president and founder of Javelin. "Data breaches are a big deal. You are eight times more likely to be a victim of fraud if you get a data-breach notice." Consumer-education efforts may be another factor, Van Dyke said.
Shadowing the good news in the Javelin report were two not-so-good details.
The average out-of-pocket expense for victims increased 63 percent from, $387 per incident in 2009 to $631 in 2010.
Generally, consumers are not held liable for fraudulent debt, but many victims still end up having to shell out money to clear their names. Van Dyke said some consumers, who get tired of the creditor calls, just pay the bills. Others end up with legal fees. A victim of identity theft may have to hire a lawyer if the criminal's actions under the stolen name lead law enforcement officials to come after the wrong person.
Javelin also found that "friendly fraud" grew 7 percent. That's the term for identity theft committed by someone known to the victim. People 25 to 34 years old are most likely to be victims of this type of fraud.
If you want to decrease your chances of becoming a victim of identity theft, follow these tips from Javelin:
l Protect your personal data. Shred documents that contain personal and financial data. I know you've heard it before, but one slip and your information is compromised. My husband and I nearly slipped recently. I was going through the recycling bin to double-check that we hadn't tossed any revealing paperwork. To my dismay, my husband had accidentally dropped in several old checkbooks. It was the kind where you have duplicate copies of your checks. For added security, the duplicates don't reveal our name, address or bank account number, but at the back of a couple of the books were a few unused deposit slips that did contain our names, address and full account number.
l Don't share so much on social networks. People using social networking for five or more years are twice as likely as those newer to these sites to suffer identity fraud.
l Monitor your bank and credit card accounts more than once a month. Javelin found that 48 percent of all reported identity-fraud cases were caught by consumers.
l Pay attention to official notices that your personal information has been lost or stolen. If you get such a letter, regularly monitor your credit reports or any affected accounts. Take advantage of free credit monitoring if it's offered.
"A lot of individuals will get a data-breach notice and do absolutely nothing," Van Dyke said. "They feel the letter itself is an indication that someone is looking out for them." Identity theft is a crime that may not seem so serious until it happens to you and your life becomes filled with frustration for days and weeks as you try to persuade creditors or even law enforcement officials that you've been a victim.
Readers can write to Michelle Singletary at The Washington Post, 1150 15th St. NW, Washington, D.C. 20071. Her e-mail address is email@example.com. Questions are welcomed, but because of the volume of mail, personal responses may not be possible.