Actual Identity Theft Victim Cases

A gentleman in San Diego, California (we’ll call him John Jones), encountered an identity thief who opened a PayPal account under John’s name and filtered $7,600 from John’s Bank of America account into the forged PayPal account. The incident occurred during July and August of 2002 but because John had been traveling he did not notice the money was actually missing until January of 2003. He contacted his bank and was informed that because he had failed to notify the bank within 60 days of the occurrence there was nothing they could do for him. By that time all of the money, with the exception of $2,100 still remaining in the PayPal account had been spent. PayPal returned the remaining sum to John but he was still out $5,000. John sued both PayPal and Bank of America in small claims court, pleading that PayPal should have notified him immediately upon discovering the fraud. Bank of America counter argued that it is the customer’s responsibility to regularly check bank statements and ensure their accuracy. In the end John walked away with a settlement from each of the firms, however was still out approximately $500 as a result. His yearlong battle to turn things right was extensive, time consuming and frustrating.

An elderly woman in Seattle, Washington (we’ll call her Jane Doe), was the victim of a telemarketing scam in December of last year. Jane provided her checking account information to the caller and later found that her account had been cleaned of $800, leaving her overdrawn by $300. When her December Social Security check was deposited the Bank of America withdrew $300 of it to cover the overdraft. Jane was left with barely enough money for food and rent and was forced to “skip” Christmas that year. By February the Bank of America had returned some of the money to her and was continuing to work with her to repair the situation.

A retired California couple (let’s call them the Smiths), were also the victims of identity theft in April of 2001. The Smiths, when attempting to refinance their home mortgage discovered that there was $75,000 in unsettled debts on an account that they had held with this particular mortgage company over a year ago. This was very strange, as they knew they had settled their debt and closed that account a year earlier. It seems that an identity thief had re-opened the account and switched the original mailing address to one in Houston Texas, which is why the Smiths had never received any bills or statements for that account. After three months of phone calls and paperwork, the Smiths had finally received confirmation from the mortgage company that they were not being held responsible for the debt. However, in December of 2003 the Smiths received a notice from the mortgage company’s Financial Services Network that they were being sued for $75,000 plus attorney’s fees for their negligence in not discovering and reporting the identity theft in a timely manner, and thus causing injury to the mortgage company. The Smiths hired a lawyer who specialized in identity theft cases and who was eventually successful in convincing the company to drop the lawsuit. The remaining bad news in this case is that the lawsuit was dropped “without prejudice”, meaning that the firm could resurrect the case in the future should they choose to do so. The Smiths endured this nightmare for almost a three-year period and still the possibility of future incidents hang over their head.

This last case that I want to share with you is more than horrific but thankfully took place prior to the United States Congress making the act of Identity Theft a federal crime. Although this is certainly not something that this victim is thankful for in anyway, but we can take comfort in knowing that an incident like this would result in a very different ending in today’s times. In this particular situation the criminal who was already a convicted felon accumulated more than $100,000 in credit card debt, applied for and obtained a federal home loan, bought homes, motorcycles and handguns in the victims name. The criminal went so far as to even calling the victim and taunting him with the fact that because identity theft was not a federal crime he could continue his charade for as long as he wanted to and nothing would happen. The criminal eventually filed for bankruptcy in the victim’s name while in the meantime the victim spent over $15,000 and four years in efforts to clear his name and re-establish his credit. In the end the criminal was not reprimanded in any way and never paid back one cent to the victim. His only punishment was serving a brief sentence due to the fact that he made a false statement when he purchased his firearm.