What is Identity Theft?
Identity theft occurs when someone uses a person's name, address, social security number, driver's license number or other unique identifier to pose as the individual for the purpose of making financial transactions, executing contracts, obtaining access to confidential information or committing crimes. The United States Department of Justice states identity theft and identity fraud "refer to all types of crime in which someone wrongfully obtains and uses another person's personal data in some way that involves fraud or deception, typically for economic gain."
A name, date of birth, and either an address or social security number are all an identity thief needs to get started. Much of that information can be obtained from a driver's license, which is routinely collected and copied prior to a test drive. However, dealerships collect far more—and far more sensitive—information. Credit applications and reports containing account information can really make the job of a would-be ID thief much easier. Even completed F&I menus can be used to compromise a customer's data security.
Once collected, all of this information is at risk until securely stored or destroyed. The fact that identity theft has been cited as the fastest-growing crime in the United States doesn't bode well for automotive dealerships. Because of the nature and amount of nonpublic, personal information dealership employees collect in the course of delivering a vehicle, dealerships are a target for identity thieves. But what happens when that thief happens to be on the payroll?
Think You Don't Need Identity Theft Protection? Think Again.
In one case in Florida, a salesman at a Chrysler dealer and his friend were arrested for using a customer's identifying information to get credit cards, purchase cell phones and to buy a new Mercedes-Benz in another state. The customer's information was stolen from his driver license and the car loan credit application he completed when he purchased a car at that dealership.
At a Lincoln-Mercury dealer in Montana, a salesman admitted to stealing identifying information from a customer's credit report. The salesman had called American Express and got a card issued in his own name. He was caught, but not before ringing up over $6,000 in merchandise. This, however, was not the first time the salesman had commited identity theft. When he was caught, authorities learned that he was also wanted for a similar case in Texas where he had obtained credit cards and fraudulently charged over $100,000 while living in that state.