- The Washington Times - Friday, February 15, 2008

American consumers reported 20 percent more cases of consumer fraud last year than the previous year, and nearly a third of their complaints related to identity theft, the Federal Trade Commission reported yesterday.

The federal agency, in an annual report on consumer-fraud complaints, revealed that out of around 810,000 cases of consumer fraud reported, more than 258,000 involved identity theft, the top complaint for the eighth year in a row.

Identity theft, which commonly involves the use of personal information such as a credit card or Social Security number to commit fraud or other crimes, accounted for 32 percent of total complaints, the FTC said.

Gripes about shop-at-home and catalog sales were a distant second on the FTC list at 8 percent, followed by complaints about Internet services (5 percent) and foreign money offers, sweepstakes and lotteries (4 percent each).

Consumer frauds, not including identity theft, cost consumers approximately $1.24 billion, up slightly from $1.18 billion in 2006.

The FTC report conflicts with the results of a survey released this week by Javelin Strategy & Research of California, which found that incidents of identity theft declined last year. Javelin estimated that 8.1 million Americans were victims of ID fraud last year, down from 8.4 million in 2006.

“Javelin’s 2008 report confirmed what we believe to be true, that while fraud is declining, it is still a concern for the American public,” said James Van Dyke, president of Javelin. “The good news is the leadership role many businesses are taking in educating consumers about ID fraud risk factors is paying off. Still, fraudsters are getting creative with new techniques to commit fraud.”

The FTC report was based on actual complaints of fraud collected by the agency and 125 other organizations, including law-enforcement agencies such as the FBI and private groups such as the Better Business Bureau. Javelin’s estimates were derived from a phone survey of 5,000 adults.

The total cost of ID fraud also dropped, the Javelin study found, to $45 billion from $51 billion a year earlier and $56 billion in 2003. The FTC did not estimate losses due to identity theft.

Among the FTC’s identity theft complaints, credit-card fraud was the most common, followed by utility fraud at 18 percent and employment fraud at 14 percent.

The metropolitan areas with the highest rates of consumer fraud complaints occurred in Albany-Lebanon, Ore.; Greeley, Colo.; and Napa, Calif. The areas with the highest rates of reported identity theft were Napa, Madera, Calif., and Greeley.

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