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The ID Thief Under Your Roof

Brian Boucher was looking for a roommate to share his one-bedroom apartment, so he did what many modern-day housing hunters do -- he posted an ad on Craigslist.org.

Seeking roommate for one-bedroom in Washington Heights. It's a bit small for two but I have to catch up on some bills... A little more than half of the $950 rent gets you the privacy of the bedroom.

John "Don" Williams -- a soft-spoken 50-ish ghostwriter from California -- responded to Boucher's post and soon after moved into the fourth-floor apartment. He paid the rent on time, kept to himself, traveled frequently, and was friendly with Boucher's two cats.

According to Boucher's account, grippingly told in the Feb. 6 issue of New York Magazine, Don disappeared in June 2004 and was missing for four weeks. Worried, Boucher started nosing around.

It turns out he wasn't the only one at the 186th Street apartment snooping. In Williams' room, he found a manila folder crammed with personal detritus -- Boucher's detritus.

There were torn up pre-approved credit card offers picked from the trash and the name and phone number from a girl Boucher had met at a party. A handwritten list ticked off all of Boucher's vitals -- names, addresses, and phone numbers of family members; his mother's maiden name and dates of his parent's marriage; information from a pay stub; and sign-in names and passwords to websites he had visited. And there was an ID with Williams' picture. But the name was different -- it was "Dino Loren Smith."

Boucher logged onto the PI database of the masses -- Google -- where in a matter of moments he found his lodger's mug shot on the America's Most Wanted website.

Dino Loren Smith was wanted for questioning in San Francisco's biggest jewel heist. It had taken place four months before he moved into the Washington Heights flat with Boucher.

Sleeping with the enemy
Despite the emotional turmoil and having to testify against his former roommate in court, Boucher was lucky. No unauthorized charges appeared on his cards. No new accounts were opened in his name. He dodged the drawn-out ordeal so many identity fraud victims face. It takes some people years and thousands of dollars to clear their name and credit track record. At worst, they are denied insurance and jobs, and some are even arrested for crimes they did not commit.

As dramatic as was Boucher's brush with potential identity fraud (the title of the New York Magazine expose is, after all, "My Roommate, The Diamond Thief"), the particulars of the violation are not that uncommon. Surveys show that one-quarter to one-half of all identity fraud victims know, or are related to, the culprit.

Family members, friends, housemates, and in-home employees have easy access to all the necessary documents and can keep a close eye on their mark (often, the elderly). Work acquaintances can poke around your desk after office hours without raising eyebrows. Worse yet, many parents "borrow" their child's Social Security number and other vitals to commit fraud.

It may feel weird to narc on someone with the same last name as yours, but shared DNA doesn't give anyone the right to rip off a loved one. The Identity Theft Resource Center offers guidelines to victims who know the perpetrator.

It's not just those with shared DNA or addresses who commit this crime or put you in danger of becoming a victim. Anyone who can legally make a case to pull your credit file is a potential culprit. Banks, credit card companies, mortgage lenders, insurers, car financiers -- all have a "permissible purpose" and "legitimate business need" to access consumer credit records.

Such widespread access has made identity fraud the fastest-growing crime, according to the Federal Trade Commission. It affects approximately 10 million Americans each year at a cost of more than $50 billion, mostly to duped businesses.

Good cop, bad cop, worst cop
The headlines have been coming fast and furious: E-thieves have targeted a wide swath of databases, everything from the New Hampshire Department of Motor Vehicles to BJ's Wholesale Club (NYSE: BJ  ) to Anglo-Dutch information provider Reed Elsevier's (NYSE: ENL  ) LexisNexis. Just as DSW (NYSE: DSW  ) was about to go public last June, hackers broke in and swiped credit card transaction information for 1.4 million of the shoe retailer's customers.

It's one thing to be targeted by ne'er-do-wells. It's quite another to practically invite them to the data-sharing party. Companies that consumers trust to guard their sensitive data have repeatedly put that information at peril. Marriott (NYSE: MAR  ) , Motley Fool Stock Advisor pick Time Warner (NYSE: TWX  ) , and Motley Fool Income Investor pick Bank of America (NYSE: BAC  ) have all reported that they misplaced back-up tapes containing information on millions of customers and employees. (Imagine that particular "lost and found" posting on Craigslist.) H&R Block (NYSE: HRB  ) printed Social Security numbers on labels of a free tax preparation software promotional mailing.

Just last month, the FTC imposed the largest civil penalty in its history against data warehouser ChoicePoint (NYSE: CPS  ) , which recklessly let unqualified subscribers (some clearly questionable) gain access to consumer information.

The personal financial records of 163,000 consumers were breached, and more than 700 instances of fraud and identity theft resulted. ChoicePoint is now required to adhere to strict security procedures and will be audited by an independent third-party security professional every other year for the next two decades.

Casting call
It'll be 2029 before Dino Loren Smith has a crack at anyone else's data. On Nov. 10, Smith was sentenced to 23 years in prison for robbery, burglary, false imprisonment, and conspiracy.

The drama of Smith's story was not lost on him. In a journal Boucher found in the bedroom, Dino had already cast the film. He would be played by Denzel Washington. The supporting cast: Laurence Fishburne as Troy (Dino's brother, who is still wanted by the FBI in association with the diamond heist), Angela Bassett as his wife, and Halle Berry in the role of Dino's girlfriend.

Brian Boucher has moved on. Literally. He now lives with a couple and their 5-year-old son whom, ironically, he found through Craigslist.

More on protecting your privacy:

Time Warner is a Stock Advisor pick. Bank of America is an Income Investor pick. Take the newsletter(s) of your choice for a 30-day free spin.

In the movie of her life, Dayana Yochim would like to be portrayed by Janeane Garofalo. Ralph Fiennes is invited to play any role he likes. The Fool's disclosure policy is ready for its closeup. Dayana owns none of the companies mentioned in this article.


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