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OIG Fraud Bulletin

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OIG Fraud Bulletin Powered By Docstoc
					                  OIG Fraud
                                                                        United States Nuclear Regulatory

                  Bulletin                                                        Commission



                                                                                       NUREG/BR 0272
                                                                                       Volume 4, No. 1
                                                                                       April 2003
                                                                                       OIG Hotline 800-233-3497


                               Identity Theft
We have all heard about identity theft. Unfortunately, there is a growing concern about
how easy it is for someone to steal your identity.
                                                                                                Inside this issue:
This office first published information on identity theft in our March 2000 issue. However,
that issue was not distributed agency wide. We have reprinted that information in this
                                                                                                Identity Theft    1-4
issue to help guide you in the event you become a victim of identity theft.
In this new world of virtual reality, it is important to keep up-to-date on the various scams   OIG Investigations 4-5
                                                                                                on Identity Theft
and how to protect yourself and your family.
We hope this information will prove valuable to you in your professional and personal life.     Websites to Help 5
                                                                                                With Identity Theft

                                                                                                Ethics Darwin     6-7
    Information Regarding Identity Theft (Information from National Consumers League)           Awards

1. What is Identity Theft?                          access codes.
Identity theft involves someone utilizing       •   Missing credit card bills or other mail.
your identifying information to acquire         •   Unusual calls regarding your personal or
goods or services in your name through the          financial information.
use of credit or debit cards, checks, or
                                                •   Unexplained charges on phone or other
other documents.
                                                    consumer accounts.
Identity theft is a considerable problem for
                                                3. Preventing Identity Theft
anyone, but is especially problematic for
those people who rely on ATM, credit            •   Cut up all credit cards for which you
cards, and other remote access financial            have no use. Similarly, when you are
services.                                           finished with them, shred bank or other
                                                    financial statements and any other
2. Detecting Identity Theft
                                                    documents containing personal informa-
The first line of defense is awareness.             tion such as social security number,
Look out for:                                       date of birth, etc.
•     Unusual purchases on your credit          •   Be creative when you select a pass-
      cards.                                        word. Don’t be obvious by using your
•     Being denied a loan for which you qual-       phone number, address, birth date,
      ify.                                          names of children or pets, the last four
•     Bank statements that don’t agree with         digits of your social security number, or
      personal records.                             any format that could easily be decoded
                                                    by thieves.
•     Unexplained changes in your bank
Identity Theft (cont. from page 1)
•   Destroy pre-approved credit card offers before you      •   Order your credit report from Experian, Trans Un-
    throw them out. A home                                      ion, or Equifax (phone numbers are listed on
                                    Keep in mind that           page 4) once a year and look for any anomalies.
    shredder (costs about $20) is
                                    some of the tips
    the best thing to use to shred  mentioned are           4. If victimized, documentation is key.
    financial statements, receipts, quite extreme.
                                                            In the worst cases, identity thieves make enormous
    and old cancelled checks that You need to use
                                    your own judgment       unauthorized purchases. By law, once you report
    you are discarding.
                                       if you become a      the loss, theft, or fraud you have no fur-
•   Make a list of all credit cards,  victim of identity    ther responsibility for unauthorized
    ATM cards, and bank accounts theft.                     charges. In any event, your maximum
    and the phone numbers asso-                             liability under Federal law is $50 per card,
    ciated with each, and keep this list in a safe place.   and most issuers will waive the fee. The
•   Remove mail promptly from your mailbox. Never           bad news is that clearing up your credit
    use your mailbox for outgoing mail.                     records requires significant effort and can take a year
•   Always use secure Web sites for Inter-                  or even longer.
    net purchases. You can tell a secure                    By monitoring your personal finances and following
    site by the little padlock at the bottom of             the suggestions in this newsletter, you may be able
    the page and/or the change at the top of                to prevent or minimize losses due to fraud and iden-
    the page from http to either “shttp” or                 tity theft. It is important to act quickly, effectively,
    “https.”                                                and assertively to minimize the damage.
•   Do not discuss financial matters on wireless or cel-    What to do if you are a victim: Here are the initial
    lular phones.                                           actions victims of identity theft should take to begin
•   Write or call the department of motor vehicles to       the investigative and recovery processes.
    have your personal information protected from dis-      1. Report the crime to your local police
    closure.                                                   immediately. File a detailed police
•   Do not use your mother’s maiden name as a pass-            report. Provide as much documented
    word on your credit cards.                                 evidence and information as possible.
                                                               Keep a copy of the incident report
•   Be wary of anyone calling to “confirm” personal            and give it to creditors, banks, and
    information.                                               merchants who ask for a copy of a police report
•   Thoroughly and promptly review all bank, credit            as part of the fraud investigation.
    card, and phone statements for unusual activity.        2. Call the fraud unit at each of the big three
•   Monitor when new credit cards, checks, or ATM              credit bureaus (Equifax, Experian, and Trans
    cards are being mailed to you and report any that          Union) to notify them of what has happened.
    are missing or late.                                       Request copies of your credit reports and ask the
•   Close all unused credit card and bank accounts.            bureaus to place a “fraud alert” in your files along
                                                               with a message asking future creditors to verify
•   Remove your social security number from checks,
                                                               by telephone any applications added to your re-
    drivers license, or other ID.
                                                               port. Follow up with a written letter.
•   Always ask for the carbon papers from credit pur-
                                                            3. Do not pay any bill or charges that result from
    chases.
                                                               identity theft. Contact all creditors immediately
•   Do not carry your social security card in your wal-        with whom your name has been used fraudu-
    let unless needed.                                         lently—by phone and in writing.

       Page 2                                                                                   OIG Fraud Bulletin
Identity Theft (cont. from page 2)
4. Write a “victim” statement of 100 words or less               fice in writing to be on the lookout
   and send to each of the credit bureaus to include             for anyone ordering a new pass-
   with your credit file.                                        port in your name.
5. Get copies of your credit reports monthly follow-         13. As appropriate, contact an at-
   ing your initial report for at least several months to       torney to help ensure that you are
   check for any new fraudulent accounts. The credit            not victimized again while attempting to re-
   bureau should provide these for free.                        solve this fraud. In order to prove your inno-
6. Call all of your credit card                                 cence, be prepared to fill out affidavits of for-
   issuers to close your ac-                                    geries for banks, credit grantors, and recipi-
   counts with the notation                                     ents of stolen checks.
   “account closed at consumer’s                             14. Be persistent and follow up. Be aware that
   request” and get new credit                                  these measures may not entirely stop new
   cards with new numbers.                                      fraudulent accounts from being opened by the
7. Contact your financial institution and request               imposter.
   new bank account numbers, ATM cards, and                  NOTE: Keep detailed written records of all con-
   checks. Put stop payments on any outstanding              versations and actions taken to recover from iden-
   checks that you are unsure of.                            tity theft. Include names, titles, date/time, phone
8. Give the bank, credit card, and utility compa-            number, exact circumstances, and action re-
   nies a NEW secret password and PIN numbers                quested. Note time spent and any expenses in-
   for new accounts. Do not use old PINs, pass-              curred. Send confirmation correspondence by
   words, or your mother’s maiden name.                      certified mail (return receipt).
9. Request a new driver’s license
    with an alternate number from the      Photocopy your driver’s license, medical cards, grocery store cards, and
                                           all charge cards with their telephone numbers and keep the copies in a
    department of motor vehicles
                                           safe place in case your wallet is stolen or you are a victim of identity theft.
    (DMV), and ask that a fraud alert be
    placed on your old one. Fill out a
    DMV complaint form to begin the fraud investiga-       Special Issues Related to Identity Theft
    tion process.                                          Occasionally, victims of identity theft are wrong-
10. Contact the Social Security Administration and fully accused of crimes committed by the imposter
    advise them of your situation. Ask them to flag        or attempts are made to hold them liable for civil
    your social security number (SSN) for fraudulent       judgments. If this occurs, contact the court where
    use. Also order a copy of your Earnings and            any civil judgment was entered and report that
    Benefits Statement and check it for accuracy.          you are a victim of identity theft. If you are sub-
    Changing your SSN is a difficult process and           jected to criminal charges as a result, quickly pro-
    should be used only as a last resort.                  vide proof to the prosecutor and investigative
                                                            agency.
11. Contact the post office and utility
    companies to ensure that no billing                     Your credit rating should not be permanently af-
    or address changes are made to                          fected, and no legal action should be taken
    your account without a written re-                      against you as a result of identity theft. If any
    quest from you. Request that all                        merchant, financial institution, or collection
    changes be verified.                                    agency suggests otherwise, simply restate your
                                                            willingness to cooperate, but don’t allow yourself
12. If you have a passport, notify the passport of-
                                                           to be coerced into paying fraudulent bills.

                                                                                                             Page 3
Identity Theft               (cont. from page 3)

The stress commonly experienced during identity theft Important Numbers to Remember
victimization and recovery can be quite severe. Victims
                                                        Social Security Administration Fraud Hotline
should consider counseling assistance as an option for
themselves and family members who may be equally        1-800-269-0271
traumatized.                                            To order your Social Security Earnings & Benefits
Pre-Approved Credit Card Offers                         Statement, call
If you don’t use credit offers that you receive, dispose       1-800-772-1213
of them by shredding. You can avoid getting these of-          Credit Reporting Bureaus
fers in the mail by calling a toll-free number operated
                                                               Equifax to report fraud
by the major credit bureaus, 888-567-8688. Your so-
cial security number will be requested to identify you.        1-800-525-6285
Getting off these marketing lists will not affect your abil-   Equifax to order credit report
ity to apply for credit in the future.                         1-800-685-1111
                                                               Experian to report fraud and order credit report
                                                               1-888-397-3742
                                                               Trans Union to report fraud
                                                               1-800-680-7289
                                                               Trans Union to order credit report
                                                               1-800-916-8800


OIG Investigations on Identity Theft
 As the media often reports, credit card fraud is one          cash advances in the retiree’s name in the
 of the fastest growing identity theft crimes in the           amounts of $9,860 and $9,500. These credit
 United States today. Often, the credit card informa-          cards were issued to an unknown individual in the
 tion is stolen (i.e., compromised) without the card           name of the retiree.
 holder’s knowledge. This compromise can happen
 many ways including: compromise through the                   OIG coordinated this investigation with the United
 credit card company files, skimming (making a du-             States Postal Service, which is involved in investi-
 plicate of the magnetic strip), and credit card num-          gating credit card and identity
 ber generating programs. The results can be large             theft fraud.
 dollar losses to the credit card company but can
 also become a problem for the individual victim. It           OIG identified no facts to indi-
 may take a large amount of time to clear up credit            cate that the former em-
 issues and report fraudulent activities to the various        ployee’s identity had been
 agencies. The Office of the Inspector General has             compromised by an NRC em-
 investigated a number of these cases. One case                ployee or NRC contractor.
 involved a retired NRC employee who reported to
 the OIG that during his retirement process someone            The OIG has also noticed an increase of compro-
 may have used his name to fraudulently obtain                 mised Citibank Travel cards at the NRC. OIG has
 credit cards.                                                 investigated several instances of employee Citi-
                                                               bank Travel cards that were compromised and
 OIG learned that two banks issued credit cards and            used by suspects for large fraudulent retail pur-
                                                               chases.
    Page 4                                                                                          OIG Fraud Bulletin
OIG Investigations on Identity Theft                                          (cont. from page 4)


These fraud schemes include the use of counterfeit        part of your account number. HANG UP! Your card is-
credit cards that are produced using the informa-         suers already have this information.
tion compromised off the NRC employee’s credit            Prizes and sweepstakes. A large part of telemarketing
card. The perpetrators of such crimes know that
                                                          fraud complaints are due to phony sweepstakes. In
time is limited with a compromised account and will
quickly charge many large ticket items.                   these scams, someone phones or e-mails to tell you that
                                                          you’ve won a prize. You are informed that all you have
In less than a month with only a handful of compro-       to do to collect it is send a certified check or provide a
mised accounts at the NRC, over $30,000 in                credit card number to cover the “cost of processing” your
fraudulent purchases were documented. Some of             award. Save your money. Legitimate awards do not
the fraud was first identified by Citibank, which then    charge processing fees. In fact, prize offers where you
notified the employee. Other fraud was first identi-      have to pay or make a purchase to be eligible are illegal.
fied by alert NRC employees who carefully and
promptly reviewed their Citibank statements and           Recovery Scams. Scammers can purchase lists of those
notified Citibank and OIG. Often, the employee            who have been swindled before. They call these people
had not even used the card in recent months or            and claim that a victim’s lost money can be recovered if
had used the card on official travel but still had pos-   he or she pays a fee. Don’t buy it. Legitimate law en-
session of the original credit card.                      forcement agencies don’t charge to help victims of tele-
                                                          marketing or online fraud.
A few simple steps can greatly reduce your vulner-
ability to credit card fraud both on                      Web Sites to Help You With Identity Theft
your personal and NRC credit cards:                       Federal Trade Commission
                                                          www.ftc.gov
•   Do not take your card with you if
    you do not need it.                                   For Identity Theft
                                                          www.consumer.gov/idtheft
•   Immediately check your account
    statement when you receive it in
    the mail or online.
                                                          Banking Agencies
                                                          Federal Deposit Insurance Corporation
•   Save your receipts to compare with monthly            www.fdic.gov
    statements.
                                                          Federal Reserve System—www.federalreserve.gov
•   Pay attention to what clerks do with your card
    while processing your transaction. Skimming           National Credit Union Adm.—www.ncua.gov
    (copying) your card will require them to "swipe"
    the magnetic strip on a second device separate        Office of the Comptroller of the Currency
    from the cash register.                               www.occ.treas.gov
•   If you notice unusual or suspicious charges,          Office of Thrift Supervision-www.ots.treas.gov
    call your credit card company immediately to
    report the item.

Watch for Scams
Lower credit card rates. With this scheme, some-
one calls and says they’re with your credit card is-
suer. They say they can lower your interest rate,
but they need to have your card’s expiration date or

                                                                                                          Page 5
                            Ethics Darwin Awards                                (from the August 2002 edition of Federal Ethics Report)


 One evening at a typical Washington reception, people were milling around being sociable and as invaria-
 bly happens the conversation turned to work. The people started discussing the ethics questions they had
 encountered over the years and started comparing stories to see who had the most absurd. They discov-
 ered they had the makings for the Ethics Darwin Awards and decided to present their findings at a meet-
 ing of the Interagency Ethics Council. Below are a few of the stories.

Conflict of Interest: “Sure I can      “My company is the best,                    who knew the employee con-
approve my own request, why            really!” A Government computer              firmed that he really believed he
not?” A Federal attorney, who                           support manager            was doing the right thing.)
was the secretary of his private                        worked for a pri-          Outside Activities: Would clon-
                    sailing club,                       vate computer re-          ing work? A Federal forest
                    sent a letter to                    pair firm during off-      fighter wanted to know if he could
                    the Navy admi-                      hours. In his offi-        have a part-time job with a local
                    ral in charge of                    cial capacity, he          fire-fighting brigade. When asked
                    the Navy facili-                    recommended and                                if that brigade
                    ties in the        then authorized sole source                                     also fights forest
nearby harbor, requesting on be-       awards to that firm. When the                                   fires, he re-
half of the sailing club the use of    Government found out about it and                               sponded in the
the Navy’s piers by the sailing        asked him what he thought he was                                affirmative.
club. Later that week, as the          doing, he said, “I am very familiar                             What did he
General Counsel for the same ad-       with the work of the firm and knew                              plan to do about
miral, the attorney reviewed his       that the Government was getting                                 his regular job in
own letter and recommended ap-         the best deal from qualified peo-           that situation? His answer: take
proval of the request. Not a bad       ple.” He received a 2-week sus-             annual leave.
system! Too bad the attorney vio-      pension without pay, and was re-
lated not one, but two criminal        moved from supervisory responsi-
statutes (18 U.S.C. §§205 and          bilities (18 U.S.C. §208). (Those
208).

Use of Government Resources:            how much of her duty day was ac-            What do you mean, this isn’t
“What do you mean, I can’t sell         tually spent on Government                  my property!” One entrepreneu-
real estate at work!” A Federal         work.)                                      rial employee backed his panel
employee, who had a second ca-          Real estate, part II. An em-                truck up to the office door one
reer as a realtor, printed                     ployee at another agency             night and stole all the computer
her agency phone number                        set up her realty business           equipment. He wasn’t too hard to
on her realtor business                        the same way. However,               catch be-
card. When she answered                        when her supervisor finally          cause he
her phone at her agency,                       took away her phone, she             tried to sell
she announced her office                       gave out her co-workers’             everything at
as “J&B Real Estate.” When ad-          phone numbers. When her per-                a yard sale
vised that she could not use her        sonal calls came in, she took over          the next
Government office for her com-          their desks to continue her realty          day—with
mercial business, she left Federal      business. She was eventually re-            bar coding and “Property of U.S.
service (5 C.F.R. §2635.704).           moved from Federal service                  Government” still prominently dis-
                                        (5 C.F.R. §2635.7).                         played (5 C.F.R. §2635.704).
(The record is silent regarding

Page 6                                                                                                   OIG Fraud Bulletin
Darwin Awards                  (cont. from page 6)

“But it makes my heart flutter!” The
agency issued a policy statement prohibit-
                                                         Organization
ing employees from viewing sexually explicit           United States Nuclear Regulatory
material via office computers and the Inter-                     Commission

net. About 6 weeks later, a supervisor
walked into an employee’s cubicle and ob-             Office of the Inspector General
served that the subordinate’s computer was            11545 Rockville Pike
connected to a pornographic Internet site.            Mail Stop T 5D28
Also, the employee’s                                  Rockville, MD 20851
computer log showed he
had visited multiple por-                            Hotline Telephone - 800-233-3497
nographic sites for almost                                    Fax: 301-415-5091
2 hours. The supervisor
issued a notice of pro-
posed suspension to the
subordinate for unauthorized use of govern-
ment property and wasting time. The em-
ployee claimed that he viewed the sites to
“cool down and relax” after an argument
with this supervisor. The employee claimed
discrimination on the basis of age (62) and
disability (heart angina) when he was is-
sued a 5-day suspension that was later re-
duced to 3 days. The Equal Employment
Opportunity Commission affirmed the                         We’re on the WEB!
agency finding of no discrimination (April 5,
2001) (5 C.F.R. §2635.704 and 2635.705).
                                                         Access the HOTLINE Thru
Clinton Zimmerman v Pirie, Secretary, De-                   the NRC Website!
partment of the Navy, 101 FEOR 1223.




                                                                                          Page 7

				
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