June 2008 Archives

Hackers are progressively finding new and innovating ways to hack into large corporate, government, college, and hospital data bases. These bits of identifying pilfered information can then be sold to multiple identity thieves who often re-sell the same morsels of information to others. That's why, once an id theft occurs in your life -odds are pretty good it can/will happen again.

Here's the latest reported data breaches for June...

Montgomery Ward - June 27
(Online database containing 51,000 - 200,000 credit card numbers hacked)

Texas Department of Public Safety - June 26
(Names, birth dates, driver's license and Social Security numbers 826 employees stolen from contracted company)

Southeast Missouri State University - June 24
(Former employee indicted for possessing 800 student names and Social Security numbers)

California Department of Consumer Affairs - June 23
(Names and Social Security numbers of 5,000 improperly transmitted electronically)

CNET Networks - June 23
(Names, birth dates, Social Security numbers of over 6,500 on stolen computers)

Virgin Media - June 20
(Unencrypted CD containing bank account details of 3,000 customers lost)

Petroleum Wholesale - June 19
(Hundreds of names, addresses and debit and credit card numbers on files found in dumpster)

Castlecroft Medical Practice - June 18
(Medical information, names, addresses, and dates of birth of 11,000 on stolen laptop)

Texas Insurance Claims Services - June 13
(Hundreds of names, addresses and Social Security numbers on files found in dumpster)

Columbia University - June 12
(Social Security numbers of 5,000 available on web)

Dickson County (TN) Board of Education - June 11
(Names and Social Security numbers of 850 on stolen laptop)

University of Florida - June 10
(Social Security numbers, names, and addresses of about 11,300 accidentally posted online)

University of Utah Hospitals and Clinics - June 10
(2.2 million billing records including 1.3 million Social Security numbers on stolen tapes)

1st Source Bank - June 10
(Debit cards replaced for an unknown number of customers)

Cotton Traders - June 10
(Card details of 38,000 customers stolen from hacked website)

University of South Carolina - June 9
(Stolen computer contains personal information of about 7,000)

East Tennessee State University - June 7
(6,200 notified about stolen computer containing personal information)]

Stanford University - June 6
(72,000 notified about personal information on stolen laptop)

Canadian Canola Growers Association - June 4
(Stolen laptop contains social insurance numbers and bank account numbers of 32,000)

AT&T - June 4
(Stolen laptop exposes employee names, salary and Social Security numbers)

Medisure - June 4
(Tapes stolen containing thousands of employee names, addresses and medical details)

Oregon State University - June 3
(Online orders of as many as 4,700 possibly compromised)

Connecticut Department of Labor - June 2
(Documents containing names, addresses and Social Security numbers of about 2,100 lost)

Walter Reed Army Medical Center - June 2
(Personal information including Social Security numbers found on "non-secure computer network")

Contributing Source: attrition.org

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See a few of the earlier months "reported" data breaches for 2008

"Reported" Data Breaches for May...

April Brought More Than Showers...

A few Data Loss Incidents...reported in March Data and more

more March: Supermarket Chain Security Breach Puts 4.2M Credit and Debit Cards at Risk

Another Day...Another Data Breach

Identity Theft Resource Center Reports Data Breaches More than Doubled in First Quarter 2008

Recently Jim and I interviewed Professor Katherine Porter on our radio show SpotLight about her report: Misbehavior and Mistake in Bankruptcy Mortgage Claims a and her recently released findings.

"Foreclosures are on the rise, and lenders and loan servicers are making a lot of mistakes in the process. In many cases, the servicers don't have the right to foreclose on homes because they don't own the loans. But unless borrowers challenge their foreclosures in court, the servicers prevail. A Harvard graduate, and law professor at the University of Iowa, Katherine Porter talks about a dirty little secret of the lending industry."

Listen to Katherine on SpotLight:

If you believe you have been targeted for foreclosure illegally or unfairly, ask the lender to produce the note that proves they own your home. Many times the note has been sold and the lender that is trying to foreclose on you -may not the right to. There is only one original note for your mortgage that has your signature on it. This is the document that proves you owe the debt.

Katherine Porter interviewed on CNN: Produce the Note!

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FIGHT FOR FAIRNESS

This process is not intended to help you get your house for free. The primary goal is to delay the foreclosure and put pressure on the lender to negotiate. Despite all the hype about lenders wanting to help homeowners avoid foreclosure, most borrowers know that's not the reality.

Too many homeowners have experienced lender resistance to their efforts to work out a payment structure to keep them in their homes. Many lenders bear responsibility for these defaults, because they put borrowers into unfair loans using deceptive, hard-sell practices and then made the problem worse with predatory servicing.

Most homeowners just want these lenders to give them reasonable terms on their mortgages, many of which were predatory to begin with. With the help of judges who see through these predatory practices, lenders will feel the pressure to work with borrowers to keep them in their homes. Don't forget lenders made incredible amounts of money by using irresponsible practices to issue and service these loans. That greed led to the foreclosure crisis we're in today. Allowing lenders to continue foreclosing on home after home, destroying our neighborhoods and our economy hurts us all. So, make it hard for your lender to take your home. Make 'em produce the note!

For additional information and steps to take to request the lender prove they own your note visit the Consumer Warning Network.

NEW YORK (June 27) - An old name in retail was hit by a modern scourge - a hack of its customers' credit card numbers - but didn't inform the consumers, revealing how data breaches might be heavily undercounted even with new notification laws.

At least 51,000 records were exposed in the breach at the parent company of Montgomery Ward. The venerable Wards chain that began in 1872 went out of business in 2001, but in 2004 a catalog company, Direct Marketing Services Inc., bought the brand name out of bankruptcy. It now runs a Wards.com Web site along with six other sites, including three with Sears brands it has acquired: SearsHomeCenter.com, SearsShowplace.com and SearsRoomforKids.com.

Direct Marketing Services' CEO, David Milgrom, said the financial company Citigroup detected the computer invasion in December. By going through HomeVisions.com, another Direct Marketing Services site, hackers had plundered the database that holds account information for all the company's retail properties.

Milgrom said Direct Marketing Services immediately informed its payment processor and Visa and MasterCard. Then, Milgrom said, Direct Marketing Services closely followed a set of guidelines, issued by Visa, on how to respond to a security breach. That included a report to the U.S. Secret Service. He said he believed by the end of December that Direct Marketing Services had met its obligations.

However, those guidelines from Visa are largely technical, and they do not cover a key additional step: that notification laws in nearly every state generally require organizations that have been hacked to come clean to the affected consumers, not just to the financial industry.

Companies that fail to comply can be hit with fines or be sued by affected customers, depending on the state.

As a result, scores of breaches covering hundreds of millions of consumer accounts have been disclosed by banks, universities, corporations and retailers in recent years.

After being asked about those laws by The Associated Press, Milgrom said Direct Marketing Services now plans to contact consumers.

This hack might have stayed quiet except for online chatter detected in June by Affinion Group Inc.'s CardCops, a group of investigators who track payment-card theft for financial institutions. In Internet chat rooms frequented by card thieves, CardCops spotted hackers touting the sale of 200,000 payment cards belonging to one merchant. CardCops then intercepted several hundred of the records, along with the online handles belonging to hackers whose real names remain unknown.

Along with the card numbers, their three-digit "security codes" and expiration dates, the thieves had the cardholders' names, addresses and phone numbers. The data had been organized in the same way, indicating the numbers likely came from the same database. CardCops' president, Dan Clements, also noticed that the vast majority of the cardholders were women, a clue that the records came from a merchant catering to a certain demographic. MORE

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To learn steps on how to protect your information

and steps to take if you learn your information has been stolen or compromised see earlier Blog: Do you know what steps to take when your information is stolen -and then used to steal YOU?

Beset by financial problems in 2002, Eunice Anderson fell months behind in the mortgage payments on her four-bedroom ranch in Redford Township, Mich., near Detroit.

Anderson, 48, a medical insurance auditor, says she was unable to refinance or negotiate a relief plan with her lender, Countrywide Financial (CFC). Facing foreclosure, she filed a Chapter 13 bankruptcy petition that let her keep her home while she paid more than $11,000 in debt.

She emerged from bankruptcy three years later with a court-filed certification that she had paid in full. But weeks later, Countrywide notified Anderson she still owed more than $10,000 in late payments and other fees, and threatened to foreclose.

"I thought when I came out of bankruptcy, I was paid up and current," says Anderson, who felt her only option was to seek bankruptcy protection for a second time. "I think it's kind of unfair."

She's now a plaintiff in a federal lawsuit that seeks class-action status and alleges that Countrywide, the nation's largest home lender, disregarded bankruptcy-court rules by billing for unwarranted fees.

The case, being fought amid what the Mortgage Bankers Association says is the highest level of foreclosures since 1979, is among scores of lawsuits accusing the lightly regulated companies that collect mortgage payments of violating borrowers' rights, a USA TODAY review of court and government records shows.

The lawsuits typically include allegations that mortgage-servicing firms mishandle borrower payments, triggering unwarranted late charges or defaults; bill homeowners for more than they owe; charge for unneeded and expensive property insurance; and disregard bankruptcy-court rules.

Countrywide, whose shareholders on Wednesday approved an expected July takeover by Bank of America (BAC), is a prominent defendant in some of the litigation. The attorneys general of Illinois and California sued the company Wednesday for alleged deceptive practices, including mortgage-servicing abuses. But cases across the nation also focus on other mortgage-servicing firms, including some owned by major investment banks.

"We see huge numbers of problems with this industry," says Tara Twomey, an attorney for the National Consumer Law Center, which represents low-income clients.

Countrywide and other mortgage servicers reject any notion that their practices have been improper. "Reports alleging that mortgage servicers are systematically charging excessive fees and using the bankruptcy process to push borrowers into foreclosure, or abusing the process more generally, are inaccurate," Steve Bailey, Countrywide's loan administration chief, wrote in testimony submitted at a May congressional hearing.

But homeowners nationwide say the firms have violated housing laws, bankruptcy rules or both:

•In a Pennsylvania bankruptcy case similar to Anderson's, Judge Thomas Agresti in May dismissed a proposed settlement of a case that included allegations Countrywide used fabricated letters in its bid to foreclose on the home of Sharon Hill in Monroeville, Pa. The letters contained purported notifications of increases in Hill's mortgage payments during the bankruptcy process. But Countrywide never sent them to Hill, court records show. They were "misrepresented as bona fide payment-change letters," a bankruptcy trustee alleged in a June 9 court filing.

Agresti called that a sign "something is not right in Denmark."

•In New Hampshire, Michael Dillon, a handyman and former freelance stage technician, won a 2005 state court decision upholding his allegations that Fairbanks Capital improperly tried to foreclose on his Manchester home.

Judge Gillian Abramson issued a contempt ruling after concluding Fairbanks had "created a predatory scheme of penalties," in part by billing him for fees for which Dillon "did not receive any notice." The ruling ordered the firm to give Dillon a chance to reinstate the mortgage "without penalties." The litigation is continuing.

•In Louisiana, a bankruptcy-court review of accounting by Wells Fargo Home Mortgage (WFC) found the firm's servicing arm collected nearly $25,000 more from Michael Jones than he owed on his Mandeville home. Judge Elizabeth Magner ordered a refund and told Wells Fargo to pay more than $67,000 in sanctions and damages. The firm has appealed.

•And in Illinois, a lawsuit that consolidated 18 cases from 10 states accuses Ocwen Financial (OCN) of engaging in a "nationwide scheme of illegal, unfair, unlawful and deceptive business practices" involving improper fees, costs and other charges. The case is in settlement negotiations, court records show.

Separately, EMC Mortgage and its former parent, Bear Stearns, notified investors in March that the Federal Trade Commission staff believes the firms "have violated certain federal consumer protection statutes" with their mortgage-servicing practices. JPMorgan Chase (JPM) acquired the servicing firm in May with its purchase of Bear Stearns. EMC said it expects negotiations to avoid a federal lawsuit.

This month, the firm also agreed to settle a federal lawsuit filed by Excel and Annie Ward, said Kenneth Mayfield, the lawyer for the Mississippi homeowners. They accused EMC of failing to refund more than $4,100 they were owed from an insurance settlement.

Along with the EMC investigation, the FTC is assessing whether other mortgage servicers and lenders "are making deceptive claims," agency Chairman William Kovacic wrote in a June 4 letter to Sen. Chuck Schumer, D-N.Y.

'Abuse' of bankruptcy process

The FTC action comes five years after it reached a $40 million settlement with Fairbanks Capital to resolve allegations the company failed to post borrowers' mortgage payments on time, charged unauthorized fees and used dishonest or abusive debt-collection practices.

Fairbanks subsequently changed its name to Select Portfolio Servicing. The renamed company, now owned by Credit Suisse, (CS) has been the subject of similar complaints to the FTC since the settlement.

The Executive Office for U.S. Trustees, the Justice Department agency that oversees bankruptcy cases, has intervened or filed actions in 16 cases involving Countrywide, GMAC Mortgage Loans, NovaStar Mortgage or Washington Mutual Bank (WM). The cases were filed in eight states. MORE

Source: USA Today
See Video: Tara Twomey Attorney with the National Consumer Law Center
Answers questions: If You Have Problems With Your Mortgage

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See:

What if we could stop some foreclosure nightmares? We could -but it would take an Act of Congress!

Foreclosure Mistakes Lenders Make And How To Protect Your Home: An Interview With Katherine Porter

If you agree that borrowers deserve the right to track their mortgage payments and verify that they are applied accurately, please sign the Petition for Monthly Statements.

If you are a college student, or the parent of one, you won't want to miss this!

Find out what funding options are available, and what options to avoid.

Have you started to fill out financial aid applications?

When should families start the process of finding financial aid?

If you have questions like these...don't miss our show this week: College Loans & Financial Aid: What you need to know!

Our Guests will include;

Jim Boyle, President of College Parents of America, the only national membership association dedicated to advocating and to serving on behalf of current and future college parents. College Parents of America members include not only parents, but also colleges and universities, local school systems, corporations, associations and other organizations dedicated to making higher education accessible - and successful - for all Americans.

Jeff Gregory, Assistant to the Director of financial Aid at the University of Colorado

Thursday, June 25th at 1:00 PM EDT

If you miss the show -it can be listened to at your convenience by visiting our archives after the show by going to ListenToSpotLight.com.

Set a reminder and help support the show!

The preliminary settlement of a class-action lawsuit against one of the big three credit bureaus, TransUnion, means almost 160 million Americans will be eligible for free monitoring services and a free credit score -but don't get too excited about it. As usual, things aren't always as they seem on the surface...their credit monitoring will only monitor TransUnion credit reports, and the credit score isn't a FICO Score, the score that most lenders see.

The lawsuit was filed eight years ago in Chicago and alleges that TransUnion sold consumer profile information to businesses, which is a violation of federal law. What started in Chicago certainly didn't stay there; eventually there were 14 federal lawsuits.

If you had a credit card, loan, credit account, from January, 1987 through May 28, 2008, you have three choices.

* Sign up for six months of credit monitoring services. If you select this option, you can also register to possibly receive cash benefits in the event of a cash distribution or file an individual lawsuit against the Defendants.'

* Sign up for nine months of enhanced credit monitoring services. If you select this option, you will not receive any further benefits, including a cash payment, and you will not be able to file an individual lawsuit against the Defendants.

* Register to possibly receive a cash payment. If you select this option, you can also sign up for six months of credit monitoring; however if you receive a cash payment, you cannot file an individual lawsuit against the Defendants.

TransUnion only has to give you free credit monitoring for your TransUnion credit report...not Equifax or Experian, the other two major credit bureaus. Remember, not all creditors report to all three credit bureaus. If a thief opens an account in your name and the creditor reports to one of the other two bureaus -you won't know about it.

The settlement additionally requires TransUnion to provide consumers with their credit score. Problem is... the score you get for free from TransUnion won't be the Fico score which is widely used by creditors when making decisions to extend credit. The TransUnion score "is not used by any major bank at this point," said Linda Sherry, spokesperson for Consumer Action, an advocacy group based in San Francisco.

TransUnion's response? "We are really very pleased that the settlement entitles so many consumers to these benefits, because it is a real benefit," said Ryan. "It presents an opportunity for consumers who want to be more involved in monitoring their credit health."

Ed Mierzwinski, consumer program director for the U.S. Public Interest Research Group, was as unimpressed with this settlement as I am... "Credit bureaus fail to protect information from ID thieves, then set up overpriced protection rackets, then sometimes get caught for deceptive marketing," Mierzwinski said. "I would never pay for monitoring. The security freeze is better. Consumers need to be wary that they aren't tricked into paying for more monitoring at the end of the 9 months."

To learn more about the free TransUnion credit monitoring, go to: listclassaction.com/claim/ or call (866) 416-3470.

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Depending on your credit needs, you should determine which of today's available products/services have the most value and best fit your needs. Here's a bit on each;

Credit Monitoring

Credit monitoring services are heavily advertised, and many people have the impression that these services alone will provide a high level of protection against identity theft. This is a serious and potentially harmful misconception.

Credit monitoring is offered by most banks and all three credit bureaus. Sometimes the service only includes monitoring one bureau's report, which is a problem, since many creditors don't report to all three bureaus. The credit report you are monitoring may not be the one a fraudulent account is reported to.

Another problem with credit monitoring services is that they're designed to inform you of any changes to your credit report; this sounds good, but what many consumers don't realize is that the data in credit reports may not be recorded in "real time." If you purchase something on credit today -do you know when the creditor will report your activity to the credit bureaus? Or when the credit bureaus will update you file? Credit monitoring services are reactive in nature -not proactive. The services are designed to let you know about a problem only after it occurs. If you are considering credit monitoring, find out if it they monitor all three bureaus, if the monitoring is done in real time and whether or not they offer identity and financial recovery services, should an ID theft occur.

Fraud alerts

A fraud alert is a flag placed in your credit reports that warns potential creditors that they must verify your identity before they issue credit in your name. Fraud alerts may be effective at stopping someone from opening new credit accounts in your name, but they won't stop thieves from accessing your current accounts if your information lands in their hands.

You need to request a fraud alert by contacting one of the three major credit bureaus. The bureau you call is required to contact the other two credit bureaus. There are two types of fraud alerts; initial and extended. An initial fraud alert is only good for 90 days -after that initial time-frame, you must re-contact a credit bureau and reactivate the alert. If you have been a victim of identity theft, you may ask for an extended alert. Each credit bureau has its own criteria you must meet, which may include filing a police report, among other things.

Credit Freeze

A credit freeze is different from a fraud alert in a number of ways. A freeze generally stops all access to your credit report, while a fraud alert permits creditors to get your report as long as they take steps to verify your identity.

A credit freeze is free to identity theft victims who have a police report proving they have been victims of identity theft. For individuals who are not victims of an identity theft, the cost is $10 per credit bureau, or $30 for all three bureaus to freeze your credit. To place a freeze on your credit file, you must write to each of the three credit bureaus, provide your identifying information and include your payment to each bureau. Freezing will prevent you from opening a new account yourself, applying for a job, renting an apartment, or buying insurance, if your credit report needs to be accessed by a creditor. Once your file is frozen, if you want to open a new credit account or get a new loan, you must "thaw" your credit file. That costs money too. Remember: Credit freezes can't block thieves from accessing your current credit cards or bank accounts.

Identity Theft Prevention & Restoration Services

Neither a fraud alert nor a credit freeze can stop a criminal from using your name to commit other crimes. Remember, your identity is much more than just your credit report. There's no protection that 100% fool-proofs you against identity theft. If your life is invaded by an identity thief -do you want to take on the task of recovering and restoring your identity alone?

There are many companies that offer to take on the task of protecting your identity and recovering -once stolen. Having been entangled with the credit bureaus for 15 years, I can tell you first hand the value of having someone in your corner once you find your information has been compromised or stolen can be priceless!.

However, before hiring one of the many services on the market today, take the time to compare the services offered and determine which has the most value to you.

Know exactly what it is you are paying for.

Whether you freeze your credit, flag it with fraud alerts or purchase credit monitoring services, you still can't be certain that you will never be a victim of identity theft. The value of knowing your aren't alone in restoring your good name, is all too often overlooked and minimized-until that is, one finds themselves in the middle of a costly and time-consuming mess -alone.

See: How much value do you place on your "free" time?

AVENTURA, Fla. -- One knock and you're a millionaire -- if it's the Publishers Clearing House Sweepstakes knocking at your door. But NBC6 discovered some scam artists are using this American tradition.

A Publisher's Clearing House promotional DVD says to "watch your mail." Letters that are showing up in mailboxes look official and claim to be from Publisher's Clearing House, but they are not.

"We're really concerned," Publisher's Clearing House representative Chris Irving said. "Consumers are losing money. We're very angry about this."

A letter came to an Aventura woman stating she was a million-dollar winner. It said Oprah Winfrey's O magazine was the sponsor. The letter included a $4,700 check for fees associated with the Publishers Clearing House prize.

But when the recipient called the phone number, Irving said, "They're told to send money back to collect a prize."

South Florida postal inspectors are on the lookout for scams like this.

"They (Publishers Clearing House) don't send a letter with a check to their winners," inspector Bladismir Rojo says. "The fact that you are just getting a letter in the mail gives you reason to be skeptical."

Felix Bossio said he lost $2,600. He said he received a letter saying he won $53,000. Also enclosed was a $2,600 check. He took it to his bank.

"So Bank of America actually cashed the check. You had money in hand?" NBC6's Willard Shepard asked.

"They said OK. They give me the money," Bossio said.

Bossio immediately left the Bank of America and went to a Sedano's grocery store, where he purchased a $2,600 money-gram and wired the funds to Toronto, Canada.

The money went to a Bobby Gray, but Felix Bossio never saw his $53,000. "They were sneaky. They never called back," Bossio said. But the bank did. The bank told Bossio the check was counterfeit and he had to replace the $2,600. "Because you deposit this check into your account and it clears, doesn't mean it's not a counterfeit," Rojo said.

NBC6 called the contact numbers on the fake Publishers Clearing House letter, and no one called back. Authorities said to look out for letters from out of the country and those with poor English.

"I think this is just a time where with the economy the way it is, obviously there's more effort on their behalf to try to scam money," Rojo said.

So far, there have been 29 complaints to the Florida attorney general about fraudulent Publishers Clearing House letters.

"If it's a legitimate prize, you never have to pay any amount to collect that prize," Irving said.

Bank of America said it cannot comment on Bossio's case.

Source: NBC6.net

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From Publishers Clearing House:

We want you to know of reports we have received detailing fraudulent e-mails pretending to be from the real Publishers Clearing House and our famous web site pch.com. These bogus e-mails tell consumers they have won a major prize with Publishers Clearing House and seek personal financial information such as bank account, checking account or social security numbers. Some may request payment for some form of bogus fee, tax or processing cost.

We know how important it is to protect your identity from unlawful use, and shield your accounts from fraud and unauthorized access. With that in mind, we want to remind you of important consumer education information about our famous sweepstakes:

* Publishers Clearing House ("PCH") does NOT send e-mails notifying consumers that they have won a major prize. If you win a major prize in our sweepstakes our Prize Patrol will contact you in person. For smaller prizes, winners are notified by overnight delivery services (FedEx, UPS) or certified mail.

* PCH does NOT send e-mails requesting personal banking or financial information in connection with a prize. If you receive an email seeking your bank account, checking account, social security number or other financial information BEWARE.

* If you are contacted about winning a prize but are required to buy something, pay a fee, tax or processing cost STOP. You have not heard from a legitimate sweepstakes and it's certainly not from the real Publishers Clearing House!

If you believe you have received a suspicious e-mail that bears our name or logo, please forward it to our fraud reporting mailbox, abuse@pch.com, and contact us immediately at our toll free number (800) 645 - 9242. We will be happy to confirm whether the communication is from the real Publishers Clearing House.

WASHINGTON--The sagging housing market has presented swindlers with a perfect opportunity to prey on troubled owners. But even owners who are making their payments on time are susceptible to being cheated out of their homes.

Financially strapped owners are considered easy marks because they're more likely to believe almost anything to save their homes. Instability in the housing sector "has created an ideal environment" for fraud, the Federal Bureau of Investigation says.

But now it notes that, through identity theft, even owners who are current can lose their houses.

One of the schemes noted in a recent FBI report has the perpetrator establishing a line of credit in his name based on the equity in your property and then draining it. In another, the con man changes the title to his name and sells the house.

Of course, as the rightful owner, you won't lose your house--as long as you can prove you, indeed, are the real owner. And that could cost you hundreds of hours and thousands of dollars.

Identity theft is defined as the use of someone's name, personal information and credit history without their knowledge. According to the Federal Trade Commission, more than 8 million people are victims every year, with resulting losses of more than $15 billion annually.

According to the Secret Service, which prosecutes federal cases, business records generally are what yield the private information. That's why Congress last fall passed the so-called "red flag" rider to the Fair and Accurate Credit Transaction Act of 2003.

The provision, which takes effect Nov. 1, requires financial institutions, creditors and anyone else who handles your personal documents to develop a program to prevent ID theft.

The rider identifies 26 things that could tell a company someone is snatching your identity. They include consumer-activated fraud alerts in a credit report and addresses and Social Security numbers that don't match those in the credit report.

In house stealing, the thief pilfers your personal information to create fake IDs and Social Security cards and files the papers necessary to transfer the property.

An empty house, say, a vacation home, is often the target, being put on the market and sold. The perp pockets the proceeds.

Con artists also have stolen an occupied house and sold it to someone so enamored of the great price he is getting that he's satisfied with online photos. Or they pose as the rightful owner and take out home-equity lines of credit against the property.

In one case prosecuted by the feds, the ID thieves used the name-change mechanism offered to people who are getting married or divorced to obtain false driver's licenses, which they used to get Social Security numbers.

In another, they deposited the proceeds from an illegal loan into a business account to get under the lender's radar. And in a third, they drained a home-equity account slowly so it wouldn't be detected. MORE

Source: Chicago Tribune/syndicated

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To learn how to lessen the odds of dealing with an intrusive id theft: visit the archives & see:

The Top 5 Tips for Protecting Your Credit Identity

The next time you apply for a loan or a new job, a lender or prospective employer might go online to access a database instead of calling your human resources department to verify your employment and income.

In most cases, they'll be contacting a company called TALX Corp., which developed a service called The Work Number.

Companies, government agencies and creditors, such as credit card companies and mortgage lenders, have been using The Work Number for almost a decade, tapping into a database with approximately 165 million to 170 million individual records (an employee has a separate record for each employer) covering roughly a third of the American work force, says Janet Ford, vice president of St. Louis-based TALX, which is a subsidiary of credit bureau Equifax.

Employers use TALX to handle salary and employment verifications and, in turn, share their payroll information and often several years' worth of payroll records. Employees can challenge the accuracy of any information.

Participating companies submit payroll information every time they process paychecks, Ford says. "So the data is as fresh as the last time they ran payroll," she says.

Before a company can access the database, it has to go through a credentialing process, says Ford, who adds that the majority of users are businesses attempting to grant credit, or government agencies attempting to grant benefits.

Employers pay a fee for TALX to store the data and to respond to employment and salary inquiries. They can also elect to receive a monthly report with the Social Security numbers of their own employees whose records were accessed, the date of the request and what type of records (salary or employment history) were viewed, says Ford. But employers are never told who is making the request or why, she says.

Companies, including would-be creditors, that make inquiries pay to access the data, which cost from $12.50 to $31 per employee, depending on the number and type of records they need, says Ford. To access salary information, they need the employee's permission.

Employment verification data includes: the company name, the employee's job title, whether the employee is active or inactive, the start date, the most recent hire date and the total length of time with the company, says Ford.

Salary inquiries would include the same information, along with pay rate and frequency, year-to-date earnings and two years of wages, she says. MORE

Automated Systems Issuing Credit without Verification Put Millions at Risk

SAN FRANCISCO, June 20 /PRNewswire/ -- Credit card companies are
knowingly contributing to the identity theft epidemic by making it easy for
people with access to patient records to apply for and receive credit using
stolen information. Hospital workers, lab technicians and even janitors
with as little as a stolen social security number are able to manipulate
the automated systems used by such industry giants as Bank of America,
Citibank and Chase to apply for and receive credit issued under the name of
an ill or incapacitated patient.

A phone call and some basic information are often enough for these
companies to grant credit without any verification of the legitimacy of the
applicant. The identity theft epidemic victimized 15 million Americans in
2006, up 50% from 2005. Severely ill patients in hospitals are often
targeted.

Anyone who is hospitalized, in extended care facilities or nursing
homes is especially vulnerable," said Eric Drew, himself a victim of
Healthcare Associated Identity Theft (HAIT). "Credit card companies'
negligent practices have fueled a wave of HAIT crimes that are seriously
affecting the financial and physical health of patients."

Drew knows firsthand the crippling implications of the epidemic. While
fighting leukemia in a Seattle hospital, his identify was stolen by a lab
technician who assumed Drew would die and proceeded to apply for credit
cards and rack up thousands of dollars in debt -- all under Drew's name. A
lawsuit is on-going to hold these banks who issued the credit responsible.

A major focus of Drew's lawsuit is to require the credit industry to
look at credit granting and reporting procedures and create a new
"Medically Incapacitated Consumer" category to consider medical patients
and elderly who would be unable to prove their innocence if attacked by an
identity thief.

"Citibank, Chase, Bank of America, Equifax, and Experian are fighting
me so they can continue to issue and report fraudulent credit without any
application verification procedures," adds Drew. "These devastating
business practices give a green light to identity thieves and put every
patient in jeopardy."

SOURCE: Eric Drew
DrewFoundation.org

The families of active duty military personnel face a set of unique credit issues. We will be interviewing Paul Richard, Executive Director of the Institute for Financial Education; an organization that has extensive history helping military families deal with credit and financial issues.

SpotLight airs on Thursday afternoons at 1:00 PM EDT and all shows can be listened to or download from our archives by going to ListenToSpotLight.com

Authorities are urging residents to watch out for people trying to scam flood victims.

So far, local authorities have not received any reports but they are warning citizens to be wary of certain scams that other flood-ravaged areas have experienced.

One of those scams involves people claiming they are from the Federal Emergency Management Agency (FEMA.gov) and going door to door, said Major Dennis Fortunato of the Fond du Lac Police Department. He said FEMA would not go door-to-door, would likely set up a claims area or office and would survey the area with local officials.

Officials said people should also be weary of contractors attempting to make money off flood victims. Victims are being warned to use reputable and local contractors to avoid paying more than they should and/or being scammed.

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Scammers arrested in Cedar Rapids, Des Moines

There have been no reports of looting in Iowa, but authorities have arrested two men who were trying to enter restricted areas in Cedar Rapids and Des Moines by posing as National Guard soldiers.

Iowa Public Safety Commissioner Gene Meyer says flood victims should be wary of scammers."You know there are numerous types of scams. They include home repair scams involving substandard or incomplete work such as debris removal, sale of unneeded disaster recovery kits, water testing and treatment, advanced fee loans and mortgages. Scam artists will travel many, many miles to victimize people who can least afford it," Meyer says. "Essentially they come in, they take the money, and they run."

In some disasters, impostors have been caught trying to get storm victims to pay cash on the spot to hook up the power, phone or water. "Please keep in mind that a utility worker working for a legitimate company will not ask for a payment to disconnect or reconnect power in any flood-related area...Look for the official utility insignia on the vehicles and the uniforms of the people who may come to your home. Insist that those workers present an identification badge," Meyer says. "...If you have questions, certainly call the utility they represent and check on that situation and report suspicious persons or activities to your local law enforcement agency."

Meyer's advice is to "never, ever" pay for a service in advance. "When con artists try to cheat disaster victims, it is the definition of adding insult to injury," Meyer says.

Meyer encourages Iowans to keep an eye out for their elderly neighbors who may be badgered by scam artists.

Source: Radio Iowa

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Marks & Klein, has filed its sixth class action lawsuit against LifeLock and its CEO Richard "Todd" Davis.

The lawsuit was filed earlier this week in the U.S. District Court for the Eastern District of Texas. This latest action follows similar suits filed against LifeLock filed by Marks & Klein in Florida, California, West Virginia, Maryland and New Jersey.

They allege LifeLock's advertising campaign misleads and basically confuses consumers and they overstate the level of identity protection the company provides. They additionally allege, that Todd Davis, CEO of LifeLock has had his own identity stolen at least 20 times -which in reality is false, according to Todd Davis. See: Today Show & CNN Videos

With each passing day, and each new lawsuit filed by Marks & Klein, it appears they are on a mission to take down LifeLock. These lawsuits are viewed by many to be more about money, than they are about "protecting" consumers!

What hasn't been pointed out in the media is that the plaintiffs in these cases haven't suffered any damages, never suffered an identity theft , they never contacted LifeLock to report any problem and they never once requested their subscription money be returned.

Marks & Klein continue to claim they are "helping" their clients and the rest of us in getting our money back. But what about those of us who want someone in our corner should our identity be compromised or stolen? What if we don't want our money back?

Who will really benefit from these lawsuits? And how much harm will they cause?

Lawsuits that are filed without merit (or damages) have a destructive effect on our judical system. These types of lawsuits give the appearance that our justice system is being used for a private agenda for financial profit and that view is chilling. I can only hope that the Judges hearing these cases will agree -and then do something about it!

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LIFELOCK CEO READY TO SET THE RECORD STRAIGHT
Todd Davis answers consumer's questions live online

Todd Davis, LifeLock CEO, will answer questions live from the public on the company's first online town hall meeting this Friday, June 20 at 10:00 AM PST. Participants are asked to register in advance at www.LifeLockAsks.com where they will receive dial-in and webinar instructions.

Recently, LifeLock has been the focus of numerous articles and blogs in regards to lawsuits, the LifeLock service and Davis' personal information being used. Davis knows this medium will provide consumers around the world the opportunity to ask questions regarding all these topics and more.

"LifeLock has always been transparent when answering questions," said Davis. "Now it is time for consumers to get the answers they need and hear the truth. I'm tired of hearing and reading things that are clearly made up or stretch the truth."

What LifeLock does:

LifeLock requests on behalf of its clients that the national credit bureaus place fraud alerts on its members' credit files;

LifeLock requests that members' names be removed from pre-approved credit card offer and junk mail lists;

LifeLock members are also entitled to LifeLock's WalletLock™, eRecon™ and TrueAddress™ services.

WalletLock works to cancel and replace all documents and personal identifying information inside a wallet if it is lost or stolen.

eRecon is a regular patrol of the Internet in search of social security numbers, credit card numbers, driver's license numbers and email addresses of LifeLock members to protect against the information being illegally traded or sold online.

LifeLock's TrueAddress service searches to see if members have had a change of address form filed and alert them if there are changes made that they may be unaware of.

LifeLock is backed by a $1 million service guarantee.

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As a long time consumer advocate, I know how hard it is for innocent consumers to fight for and find accountability in our judicial system. Lawsuits filed that appear to be baseless, without merit and without any damages are a slap in the face to our system of justice and to wronged consumers.

To read why I subscribe to LifeLock and support these much needed services see:

How Much Value do you Place on Your "Free" Time?

Who Really Profits From Identity Theft?

As the price of gasoline tops four dollars a gallon nationwide consumers who are driving less could save an average of 5 to 15 percent on their automobile insurance rates - about $47 to $142.

That's according to the Consumer Federation of America (CFA), which says that skyrocketing fuel costs could mean savings on automobile insurance as drivers react to high gas prices by using mass transportation, car-pooling, taking fewer trips to the store or curtailing their vacations.

"Auto insurance rates are partially based on how much you drive and how you use your car," said J. Robert Hunter, director of insurance for CFA and former Texas Insurance Commissioner and Federal Insurance Administrator said in a consumer press release. "If you drive less to save money on gas, these driving changes might mean that you qualify for immediate insurance rate relief."

His group is urging all drivers to call their insurance company or agent and ask if they qualify for a rate reduction.

While savings will vary based upon the specific auto coverage a driver has, it is worth a call, according to Hunter. "Simply explain the actions you are taking to drive less and estimate how many fewer miles you are driving a month," he said. "Tell the agent or company representative that you want the cheapest rate they have for drivers reflecting your new driving circumstances."

His organization also wants state insurance officials to take note.

In a letter sent earlier this week, CFA called on the nation's governors to require insurance companies to lower their rates as Americans drive less.

"As Americans drive less because of the price of gas, fewer claims will be filed with insurance companies," said Hunter. "Whether this will mean windfall profits for insurers or rate cuts for the consumers is up to governors and state regulators to determine. We ask that each state immediately call hearings to determine the right auto insurance prices under the changed driving situation."

Source: Insurance Journal

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Gas Prices Too High? Don't Trade In Your Car Just Yet

By Jim Malmberg

Virtually anyone you ask will tell you that gas prices are impacting their standard of living. As a result, many people are considering trading in their cars for more fuel efficient models. While this may sound like a good idea, it can be a mistake that will only cause you to run up additional debt. The only way to know if changing your mode of transportation is a good idea is to do the math. Regrettably, this is a step that many people are not going through when they evaluate a new car.

The idea of purchasing a car that gets better gas mileage sounds great. Car manufacturers know this, and they are capitalizing on it. And there is a secret that they don't want you to know. As a consumer, if you are thinking about trading in your existing automobile for a hybrid, you may actually wind up spending more money than you actually save.

Take for instance the GMC Yukon hybrid SUV. GMC's website says that you can get up to "50% better city fuel economy when compared to the conventional engine." But what does that mean in terms of your wallet? To find out, we have to do a little math.

The difference in cost between the base model of Yukon hybrid and the standard Yukon with a conventional engine is significant. The hybrid starts at just over $50,000. A base model Yukon can be purchased for around $35,000... a difference of approximately $15,000. That's a lot of gas.

According to GMC, the combined city/highway mileage for their hybrid is 21 miles. Giving GMC the benefit of the doubt, we'll agree that they actually do improve mileage by 50%. This would mean that the regular Yukon gets a combined city/highway mileage of 14 miles per gallon.

Now let's say that you drive 12,000 miles per year. Driving the regular Yukon, your bill for gas for the year would be $4,286 at $5 per gallon. In the Yukon hybrid, it would be $2,857. That's a savings of $1,429 per year driving the hybrid.

While that savings may sound good, remember that by purchasing the hybrid you spent an additional $15,000. If you divide the $15,000 additional expenditure by your savings per year - $1,429 - you will get the number of years it will take to pay for the additional expense of purchasing the hybrid. In this example, it would take you nearly 10.5 years to justify the additional expense.

Whether or not it will pay you to change vehicles is dependent upon how much you drive, and how long you think you will own your next car. Most people won't hold onto a car for 10.5 years. It may also depend on how high the price of gas actually goes. If it continues to rise, then the amount of time it takes to pay for a hybrid will actually go down provided that the manufacturers don't increase their prices.

It's also important to note that this is just one example. ACCESS is unaware of any hybrid cars that are less expensive than their conventional counterparts. Even so, the difference in price between a hybrid and a conventional car may be more or less than the example we gave. Again, the less the difference in price between a conventional car and a hybrid, the faster it is to recoup any difference.

One final note here is that if you owe more on your current car than it is worth, then you should keep it. Many dealers can offer you the ability to role your existing payments into a new loan. This would allow you to trade in your old car for a new one. It would also mean that even before you drive that new car off the lot, you owe more in it than it is worth. Many consumers have been bamboozled into this type of loan. It is a bad idea and should be avoided at all costs.

The bottom line is that the only way to know if you should make a switch is to do the math yourself.

More aggressive strategies fill court dockets, result in mistaken identities
Chicago Tribune:

Cook County Circuit Court has been turned into a frenetic debt collections machine, a reflection of easy credit gone sour and a collections industry determined to get paid.

More than 119,000 civil lawsuits against alleged debtors are clogging courtrooms, and at least half will result in judgments that debt collectors will use to dock wages, seize bank accounts and file liens against homes, compounding the woes of troubled borrowers.

But because debt collectors operate on volume--pushing through lawsuits based on little more than lists of names, addresses and alleged amounts due--there are also plenty of instances of mistaken identities, cases where debts are alleged when the bills have been paid and even situations where people have fallen behind and tried to work out repayments only to be hauled in to court.

"The system is out of control," said Michelle Weinberg, a supervisory attorney at the Legal Assistance Foundation of Metropolitan Chicago. "It's one thing to call a debtor on the phone. It's another thing to file a lawsuit in court."

The cases that bother the judges the most are those where people have simply fallen behind because of illness or job loss or inability to keep up with escalating bills, a situation that is expected to worsen as a result of rising food, gasoline and housing costs.

"These people aren't deadbeats," said Cook County Circuit Judge Daniel Gillespie, whose docket contains 12,000 debtor suits, about double from two years ago. He also supervises seven courtrooms on the Daley Center's 11th floor where such cases are brought. "These are real people with real problems," he said.

Down slippery slope
Geraldine Wandall is an example. When her health began failing about four years ago the retired bookkeeper, who lives on Social Security, fell behind on bills.

Wandall said she wrote letters to the department store that issued the credit card to see if it would reduce or eliminate some of the interest charges and late fees on her account. She said she never got a response. MORE

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Lawyer makes dirty debt collectors payThe Avenger: Pete Barry goes after those "who live off the misery of others"

We are a nation in debt and the bill has come due. The average American consumer has four credit cards, owes nearly $10,000 in non-mortgage debt, and can no longer rely on his home equity as a safety net. With spiking fuel prices, stagnant wages, and bankruptcy costlier than ever, more people are falling behind on their bills--and getting dragged into ruin.

All of which makes now a good time to be a debt collector. Awash in fresh accounts, the business is also expanding into new areas: In the last decade, years-old consumer debt has become a commodity to be bought and sold on the free market. "Buy it now! Buy it all!" screams the six-page ad in a recent issue of Collections & Credit Risk, an industry trade publication that offers a smorgasbord of unpaid tabs for sale: credit cards, car loans, hospital expenses, mortgages, even gas bills.

When a debtor won't pay, collectors use a variety of techniques--some legal, some not--to extract the money. They might threaten to ruin your credit score, garnish your wages, and, in extreme cases, even cuss out your child. Last year, the Federal Trade Commission reported receiving 71,000 complaints about debt collectors behaving badly--more than any other industry monitored, and the highest total in the 30 years that the authority has been keeping track.

If debt collectors thrive on intimidation, there's one man who strikes fear into them: Pete Barry. In the decade he's been suing dirty debt collectors, Barry has pried loose millions of dollars in damages. MORE

While everyone likes the convenience of going wireless,few are aware of the dangers of not using the proper security. Albert E. Whale, President of ABS Computer Technology, Dan Yost, Chief Technology Officer of MylaptopGPS & Mike Aiello, Founder of DIFRWEAR tell us how to protect our data from hackers, skimmers & laptop thieves!

Listen to their interviews at listentospotlight.com

Next week: Credit Issues Faced by Military Families

The families of active duty military personnel face a set of unique credit issues. We will be interviewing Paul Richard, Executive Director of the Institute for Financial Education; an organization that has extensive history helping military families deal with credit and financial issues.

For more info on Military see CreditBoards.com credit forum thread: Military Deployment and Credit

Think about your next dispute with your credit card company. A mistaken charge? Failure to credit a return? A penalty fee that they promised to waive? Or ratchet it up a little: Identity theft? A lost payment that triggered penalty interest and fees?

If you think you'll be protected from mistakes, think again.

Business Week has a cover story this week on how credit card disputes are settled through arbitration, specifically through NAF, an arbitration outfit that, by its own accounting, arbitrated 18,075 cases between a business entity and a California consumer.

The score? Business 18,045/Consumers 30.

Whether you know it or not, you may have already lost your next dispute with your credit card company--even if they made the mistake and you can prove it.

Read the story for all the details. Reporters Robert Berner and Brian Grow give us investigative reporting at its best. The story is factual, compelling and genuinely scary.

The Business Week story is for everyone who thinks that, by and large, fairness will win out, for everyone who thinks that a big-name company would never deliberately take advantage of its customers, and for everyone who thinks that arbitration sounds like a low-cost, fair way to clear up problems. MORE

Source: Elizabeth Warren
Warren Reports

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From: CreditCardReform.org
A project of Consumers Union

Has your credit card company used every trick in the book to maximize what you have to pay?

Consumers recently asked Congress and the credit card companies to end credit card abuses. Now you have a real opportunity to change the way these companies do business.

The Federal Reserve just proposed tough new rules that will stop credit card companies' abusive practices. But these reforms aren't a sure thing the banks are lobbying hard against them.

Take a moment now to tell the Fed to hang tough and enact these fair rules.

Right now, your card company can hike the rate you pay on your existing balance for any, or no, reason. Your card company may apply your entire payment to the low-interest balance you transferred from another card, while your higher interest debt piles up. Or it may not give you reasonable time between the billing date and the due date, so your payments are sometimes late.

These and other practices would be reined in by the banks' highest regulator. But the Fed needs to hear how these tricks hurt real people.

Even if you haven't experienced these specific problems, we need you to tell the Fed to stand up to the banks.

The Federal Reserve Board hears from Wall Street all the time. Make sure it also hears from you!

And when you are done, forward this info to everyone you know who uses credit cards. We all have a strong interest in fair rules that rein in the worst card company abuses. It will only take a minute, and it's a minute that will really matter.

Let the Fed know what you think about credit card reform. Your voice does make a difference!

The Federal Reserve Board proposes simple rules to level the playing field

Click here to learn more about this important proposal.

University of Florida notifies 11,000 students that Social Security numbers were posted online

June 10, 2008

GAINESVILLE, Fla. (AP) - The University of Florida is sending letters to more than 11,000 current and former students to notify them that their Social Security numbers, names and addresses were accidentally posted online.

University officials said Tuesday that the privacy breach was recently discovered during a routine systems audit.

The information became available when former student employees of the Office for Academic Support and Institutional Service, or OASIS, program created online records of students participating in the program between 2003 and 2005. The information has been removed.

School officials said the notification letters were being sent to about 11,300 students whose information is believed to have been compromised, but they were unable to find contact information for about 570 people.

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Utah hospital billing records from over 2 million patients stolen

June 10, 2008

SALT LAKE CITY (AP) - Billing records of 2.2 million patients at the University of Utah Hospitals and Clinics were stolen from a vehicle after a courier failed to immediately take them to a storage center, authorities said Tuesday.

The records, described only as backup information tapes, contained Social Security numbers of 1.3 million people treated at the university over the last 16 years, said Lorris Betz, senior vice president for health sciences. MORE

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1st Source swaps out ATM cards after breach

June 10, 2008

1st Source Bank is replacing ATM cards this month for all its account holders after cyber-thieves accessed an unknown amount of debit-related data, a bank official said Wednesday.

The South Bend-based bank has not received any reports of suspicious activity, however, said James Seitz, senior vice president of consumer and electronic banking

Betz said people would be notified by a letter at a cost of $500,000 just for stamps and envelopes. The hospital also pledged free credit monitoring.

The records were in a gray metal box. The courier, whose name was not released, picked them up in his Ford Explorer on June 1. But instead of driving directly to a storage center, he worked a second job and then went home, Salt Lake County Sheriff Jim Winder said.

The next day, he discovered that someone had broken into his Ford Explorer outside his Kearns home and taken the box, Winder said.

Authorities declined to say how easy or difficult it would be to read the records. They refused to describe the format or whether the information was on a disk. The sheriff believes the thief probably thought the box contained money. MORE

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Card details stolen in web hack

June 10, 2008

The credit card details of up to 38,000 customers of clothing firm Cotton Traders were stolen following a hack of its website, BBC News has learned.

The firm has not confirmed the size of the breach but it has acknowledged the site was attacked early this year.

It said Barclaycard was contacted as soon as it learned of the attack, and most cards were stopped in January.

The payment industry's trade body said it was serious because hackers accessed details for "card not present" fraud. MORE

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USC warns personal data may be on stolen computer

June 9, 2008

The University of South Carolina is warning about 7,000 faculty, staff and students that some of their personal information was on a desktop computer stolen from an office at the business school.

Russ McKinney, the university spokesman, said that over the Memorial Day weekend, several items were stolen from an office in the Moore School of Business.

"Among the items was a desktop computer belonging to Deputy Dean Dr. Scott Koerwer," McKinney said. "As a result of the computer being stolen, we feel it is possible that some personally identifiable data could have been compromised."

McKinney said university officials have no evidence anyone's personal information was accessed.

"We feel the responsible thing for us to do is to notify those persons whose data was contained in the computer, and advise them of the fact, and share with them some useful steps they may want to take for additional protection," McKinney said.

He said the university is notifying about 130 faculty and staff at the Moore School, and just under 7,000 students who took business courses in the last academic year. McKinney said the university's Division of Law Enforcement and Safety and Office of Information Technology are investigating the matter. Deputy Dean Koerwer circulated a letter to students dated June 6 that suggested some steps they might take to protect themselves from identity theft. MORE

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ETSU says stolen computer could lead to identity theft
June 8, 2008

AP: East Tennessee State University has sent a letter to 6,200 people whose identities could be compromised by the theft of a desktop computer.

The letter, dated Monday and provided to the Johnson City Press by the father of a graduate who received one, says the computer is password protected and files cannot be easily accessed. But it says there is a small possibility that the information could be compromised.

Those who received the letter are asked to notify one of the three major credit bureaus and place a fraud alert on their files.

University Provost and Vice President for Academic Affairs Bert C. Bach said ETSU has set up a Web site with procedures for preventing or dealing with identity theft.

Bach said the missing computer was stolen from a secured area on May 17. ETSU officials are investigating.

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See the first week of June "reported" data breaches at the end of this earlier blog entry: An Analysis of Identity Theft Through The Victims Eyes

A recent email I received from a concerned appraiser;

In his words:

I'm an appraiser in michigan........I come to this site very infrequently since I'm so busy doing reos and fifth third equity loans.........but I need to let you know another little dirty secret. Recently the rise in calls I'm getting from "basement brokers" has risen dramatically.

This is the deal....hopefully you can do something because I can't.

If you would like to speak with this writer...please email me.

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Mortgage servicing companies -an unregulated industry.

Listen to Katherine Porter's interview on her recent report: "Misbehavior and Mistake in Bankruptcy Mortgage Claims"

Indian outsourcer steals client data, sells to competitors

The Times of India recently reported a case that will strike fear into the hearts and minds of information security specialists and C-level executives that support and promote the use of outsourcing for company processes and operations.

According to the report, the owner of an IT business process outsourcing (BPO) service provider has been accused of stealing information from Florida-based company Noble Ventures, and reselling it to their U.S.-based rivals.

When Noble Ventures cancelled their contract for Web site creation and maintenance with Ahmedabad-based Business Bee Solutions, the company's owner closed his BPO shopfront and moved operations to his home.

It is not known when he sold the data belonging to Noble Ventures, but he used an American-based accomplice to sell the stolen information to Noble Ventures' U.S. competitors. MORE

Also see: The Times of India

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Phishing Scam Alert: American Airlines AAdvantage Members Receive Phishing Scam emails

If you receive an email from what appears to be from American Airlines don't click on the embeded link or you will be scammed.

If you received the below email, do not open the link and delete the email immediately.

The email looks official -yet it is simply a "phisihng" scam designed to trick you into believing it is from American Airlines. If you click on the link, you will be whisked off to a site that also looks legit.

They then ask you to provide you PIN and AAdvantage membership number and then ask you to take a quick survey where they then ask for your personal identifying information that includes your social security number, date of birth, mother's maiden name, credit card numbers, etc, etc.

Here is the phishing email:

Greetings from AA.com

Sincerely,
American Airlines Reward Department

If you have received the phishing email and already provided your personal AAdvantage information, please log on to AA.com immediately, verify your account balance and change your password. If unauthorized changes have been made to your account, please call us at 1-800-882-8880 and speak "AAdvantage Services," then select "Account Information" and ask for an "agent."

If you provided other personal information when completing the phishing survey, AA suggests you contact your financial institutions.

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The business of resolving credit-card disputes is booming. But critics say the dominant firm favors creditors that are trying to collect from unsophisticated debtors.

What if a judge solicited cases from big corporations by offering them a business-friendly venue in which to pursue consumers who are behind on their bills?

What if the judge tried to make this pitch more appealing by teaming up with the corporations' outside lawyers?

And what if the same corporations helped pay the judge's salary?

It would, of course, amount to a conflict of interest and cast doubt on the fairness of proceedings before the judge.

Yet that's essentially how one of the country's largest private arbitration firms operates.

The National Arbitration Forum (NAF), a for-profit company based in Minneapolis, specializes in resolving claims by banks, credit-card companies, and major retailers that contend consumers owe them money. Often without knowing it, individuals agree in the fine print of their credit-card applications to arbitrate any disputes over bills rather than have the cases go to court. What consumers also don't know is that NAF, which dominates credit-card arbitration, operates a system in which it is exceedingly difficult for individuals to prevail.

Some current and former NAF arbitrators say they make decisions in haste--sometimes in just a few minutes--based on scant information and rarely with debtor participation. Consumers who have been through the process complain that NAF spews baffling paperwork and fails to provide the hearings that it promises. Corporations seldom lose. In California, the one state where arbitration results are made public, creditors win 99.998% of the time in NAF cases that are decided by arbitrators on the merits, according to a lawsuit filed by the San Francisco city attorney against NAF.

"NAF is nothing more than an arm of the collection industry hiding behind a veneer of impartiality," says Richard Neely, a former justice of the West Virginia supreme court who as part of his private practice arbitrated several cases for NAF in 2004 and 2005.

A DIFFERENT REALITY

NAF presents its service in print and online advertising as quicker and less expensive than litigation but every bit as unbiased. Its Web site promotes "a fair, efficient, and effective system for the resolution of commercial and civil disputes in America and worldwide."

But internal NAF documents and interviews with people familiar with the firm reveal a different reality. Behind closed doors, NAF sells itself to lenders as an effective tool for collecting debts. The point of these pitches is to persuade the companies to use the firm to resolve clashes over delinquent accounts. JPMorgan Chase (JPM) and Bank of America (BAC) are among the large institutions that do so. A September, 2007, NAF PowerPoint presentation aimed at creditors and labeled "confidential" promises "marked increase in recovery rates over existing collection methods." At times, NAF does this kind of marketing with the aid of law firms representing the very creditors it's trying to sign up as clients. SEE

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See: Binding Mandatory Arbitration & What You Really Need to Know About it!

Identity Theft Resource Center's release on its 5th Annual Aftermath Study - an Analysis of Identity Theft Through the Victim's Eyes.

The following are some highlights of The Aftermath 2007 study. An analysis of the entire study was done by two business analysts and a psychologist, with their comments included in the full report. The full report can be found on the ITRC website: idtheftcenter.org

• Prevalence of Types of Identity Theft Crimes: Financial identity theft crimes were reported by 78% of the respondents, 2% reported criminal cases only, and 2% reported governmental issues only. The rest were combination cases: financial and criminal (7%), financial and governmental (9%), and a mixture of all three types (3%).

• Uses of victim information: More than one-half (57%) of the 2007 sample reported their personal information had been used to open a new line of credit in their name. 13% of all respondents noted their information was used for obtaining new cable and/or utility services. (Table 2) It should be noted, check fraud and debit card fraud are increasing. The ITRC continues to predict that criminals will turn to other types of identity theft when it becomes more difficult to open new lines of credit. This may indicate changes due to the sampling taken.

*Costs to Victim: Respondents in 2007 spent an average of $550.39 in out-of-pocket expenses for damage done to an existing account. In reference to new accounts, respondents spent an average of $1,865.27 compared to $1,342 in 2006.

*Cost to Business: In 2007, the average loss in goods and services to businesses, as reported by survey respondents, was $48,941 compared to $87,303 in 2006. Six individuals exceeded $100,000, with one in excess of $700,000. This study only includes respondents who contacted the ITRC in 2007 and is not necessarily indicative of a national business loss average.

*Victim Hours Repairing Damage: In The Aftermath 2007, victims reported spending an average of 116 hours repairing the damage done by identity theft to an existing account used or taken over by the thief. Answers included 6,000, 8,640, and 5 years of time (outliers). In cases where a new account was created, respondents reported an average of 158 hours to clean up the mess with outliers of "endless" and "too many to count."

*Extended involvement: In 2007, 70% of victims indicated that it took up to 12 months to clear issues of all misinformation, compared to 50% in 2006. A moderate amount of victims (12%) took one to two years. Unfortunately, some 19% indicated that it took two or more years to resolve their case.

*Response by Creditors, Utilities and Collection Agencies: As in previous years, credit issuers, utility companies and collection agencies continue to rate