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74–006 2011

FIELD HEARING ON SOCIAL SECURITY NUMBERS 

AND CHILD IDENTITY THEFT 

HEARING 

BEFORE THE

SUBCOMMITTEE ON SOCIAL SECURITY 

OF THE

COMMITTEE ON WAYS AND MEANS 

U.S. HOUSE OF REPRESENTATIVES 

ONE HUNDRED TWELFTH CONGRESS 

FIRST SESSION 

SEPTEMBER 1, 2011 

Serial 112–SS9 

Printed for the use of the Committee on Ways and Means 

( 


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COMMITTEE ON WAYS AND MEANS 

SUBCOMMITTEE ON SOCIAL SECURITY 

SAM JOHNSON, Texas, Chairman 

KEVIN BRADY, Texas 

PAT TIBERI, Ohio 

AARON SCHOCK, Illinois 

RICK BERG, North Dakota 

ADRIAN SMITH, Nebraska 

KENNY MARCHANT, New York 

XAVIER BECERRA, California 

LLOYD DOGGETT, Texas 

SHELLEY BERKLEY, Nevada 

FORTNEY PETE STARK, California 

JON TRAUB, Staff Director 

JANICE MAYS, Minority Staff Director 


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C O N T E N T S 

Page 

Advisory of September 1, 2011 announcing the hearing ...................................... 2 

WITNESSES 

Stacey Lanius Plano, Texas .................................................................................... 5 

Testimony .......................................................................................................... 7 

Steve Bryson Allen, Texas ...................................................................................... 9 

Testimony .......................................................................................................... 10 

Deanya Kueckelhan Director, Southwest Region, Federal Trade Commission, 

Dallas, Texas ........................................................................................................ 11 

Testimony .......................................................................................................... 13 

Lynne M. Vieraitis, Ph.D. Associate Professor of Criminology, University of 

Texas at Dallas, Richardson, Texas .................................................................... 27 

Testimony .......................................................................................................... 30 

Robert Feldt, Special Agent In-Charge, Office of the Inspector General, Social 

Security Administration, Dallas Field Division, Dallas, Texas, accompanied 

by Antonio Puente, Special Agent, Dallas Field Division, San Antonio, 

Texas. .................................................................................................................... 36 

Testimony, Robert Feldt .......................................................................................... 38 

Testimony, Antonio Puente ..................................................................................... 46 


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FIELD HEARING ON SOCIAL SECURITY 

NUMBERS AND CHILD IDENTITY THEFT 

THURSDAY, SEPTEMBER 1, 2011 

U.S. HOUSE OF REPRESENTATIVES, 

COMMITTEE ON WAYS AND MEANS, 

SUBCOMMITTEE ON SOCIAL SECURITY, 

Washington, DC. 

The subcommittee met, pursuant to call, at 12:00 p.m., in the 

Plano City Council Chamber, 1520 Avenue K, Plano, Texas, Honorable Sam Johnson [chairman of the subcommittee] presiding. 

[The advisory of the hearing follows:] 


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ADVISORY 

FROM THE COMMITTEE ON WAYS AND MEANS 

September 01, 2011 

Subcommittee on Social Security 

Chairman Johnson Announces Field Hearing on 

Social Security Numbers and Child Identity Theft 

U.S. Congressman Sam Johnson (R–TX), Chairman of the House Committee on 

Ways and Means Subcommittee on Social Security announced today that the Subcommittee will hold a field hearing on Social Security numbers (SSNs) and child 

identity theft. The hearing will take place on Thursday, September 1, 2011 

in the Plano City Council Chamber, 1520 Avenue K, Plano, Texas at 12:00 

p.m. Central Standard Time. 

In view of the limited time available to hear witnesses, oral testimony at this 

hearing will be from invited witnesses only. However, any individual or organization 

not scheduled for an oral appearance may submit a written statement for consideration by the Committee and for inclusion in the printed record of the hearing. A 

list of invited witnesses will follow. 

BACKGROUND: 

According to the U.S. Department of Justice, between 2006 and 2008, approximately 11.7 million people were victims of identity theft. The Federal Trade Commission (FTC) estimates that identity theft costs consumers about $50 billion annually. Further, identity theft is often used to facilitate other crimes, including credit 

card, document, or employment fraud. The Social Security number (SSN) is especially valuable to identity thieves who can use it to create a false identity in order 

to open accounts or obtain other benefits in the victim’s name. 

Perhaps more disturbing is the growing trend in child identity theft. There were 

19,000 cases of child identity theft reported to the FTC in 2009, a 192 percent increase since 2003 when 6,500 cases were reported. 

Family members may use a child’s name and SSN to obtain new credit. Other 

criminals may obtain a child’s name and SSN or use different names and birth 

dates to avoid detection as businesses granting credit may not ensure names, SSNs, 

or dates of birth match. In the meantime, children of all ages whose SSNs have 

been compromised may discover years later that they have a record of bad debt including years of unpaid bills, credit card debt, or loan defaults. Recently, the FTC 

has intensified its work regarding the growing problem of child identity theft, gathering identity theft experts and law enforcement officials for the first ever conference on child identity theft in July 2011 entitled, ‘‘Stolen Futures, A Forum on 

Child Identity Theft.’’ 

In announcing the hearing, Chairman Sam Johnson (R–TX) stated, ‘‘Identity 

thieves prey on the good credit of law abiding citizens. Social Security 

numbers, even those belonging to children, are often the keys to pulling off 

these crimes. Taking steps to stop the overuse of Social Security numbers 

and giving law enforcement better tools to stop these thieves will help prevent identity theft and further protect the privacy of all Americans and 

their children.’’ 

FOCUS OF THE HEARING: 

The Subcommittee will examine the emerging patterns of child identity theft, the 

role of SSNs in these crimes and steps families can take to help protect themselves. 


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Legislative options to help prevent these crimes and assist law enforcement will also 

be considered. 

DETAILS FOR SUBMISSION OF WRITTEN COMMENTS: 

Please Note: Any person(s) and/or organization(s) wishing to submit for the hearing record must follow the appropriate link on the hearing page of the Committee 

website and complete the informational forms. From the Committee homepage, 

http://waysandmeans.house.gov, select ‘‘Hearings.’’ Select the hearing for which you 

would like to submit, and click on the link entitled, ‘‘Click here to provide a submission for the record.’’ Once you have followed the online instructions, submit all requested information. ATTACH your submission as a Word or WordPerfect document, in compliance with the formatting requirements listed below, by the close 

of business on Thursday, September 15, 2011. Finally, please note that due to 

the change in House mail policy, the U.S. Capitol Police will refuse sealed-package 

deliveries to all House Office Buildings. For questions, or if you encounter technical 

problems, please call (202) 225–1721 or (202) 225–3625. 

FORMATTING REQUIREMENTS: 

The Committee relies on electronic submissions for printing the official hearing 

record. As always, submissions will be included in the record according to the discretion of the Committee. The Committee will not alter the content of your submission, 

but we reserve the right to format it according to our guidelines. Any submission 

provided to the Committee by a witness, any supplementary materials submitted for 

the printed record, and any written comments in response to a request for written 

comments must conform to the guidelines listed below. Any submission or supplementary item not in compliance with these guidelines will not be printed, but will 

be maintained in the Committee files for review and use by the Committee. 

1. All submissions and supplementary materials must be provided in Word format and MUST 

NOT exceed a total of 10 pages, including attachments. Witnesses and submitters are advised 

that the Committee relies on electronic submissions for printing the official hearing record. 

2. Copies of whole documents submitted as exhibit material will not be accepted for printing. 

Instead, exhibit material should be referenced and quoted or paraphrased. All exhibit material 

not meeting these specifications will be maintained in the Committee files for review and use 

by the Committee. 

3. All submissions must include a list of all clients, persons, and/or organizations on whose 

behalf the witness appears. A supplemental sheet must accompany each submission listing the 

name, company, address, telephone, and fax numbers of each witness. 

Note: All Committee advisories and news releases are available on the World 

Wide Web at http://www.waysandmeans.house.gov/

f 

. 

Chairman JOHNSON. The hearing will come to order. 

Back in November 1936, the U.S. Postal Service first began 

issuing Social Security cards to workers. Even though Social Security numbers were created to track earnings for determining Social 

Security benefits, today these numbers are widely used as personal 

identifiers. 

Some uses of Social Security numbers are mandated, for example, for income and tax-related reporting to the IRS by employers, 

banks and insurance companies. Countless other businesses use 

this nine-digit number as a default identifier to facilitate the 

matching of consumer information. Also, many businesses wrongly 

use Social Security numbers to prove an individual is who they say 

they are; in other words, an identification number. 

Once a thief has someone’s Social Security number, they’re often 

able to open new accounts, access existing accounts or obtain other 

benefits in the victim’s name. In fact, in their April 2007 report, 


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the Identity Theft Task Force created by President George Bush 

identified the Social Security number as the most valuable commodity for an identity thief. Months or even years later, victims 

first learn about the crime often after being denied credit or employment or being contacted by a debt collector. 

As we will hear from two of our witnesses today, learning your 

private, personal and financial information has been compromised 

is devastating. Even worse, victims must take the lead in repairing 

and restoring their records. 

For years victims have to prove who they are while monitoring 

credit reports, arguing with collection agencies and dealing with 

the IRS and Social Security about wages they didn’t earn and taxes 

they don’t owe. Some may learn they have a criminal record which 

could disqualify them for a job. 

Americans are right to be concerned. According to the Department of Justice, in 2009, ID theft claimed over 11 million victims. 

That’s 5 percent of all adults. The Privacy Rights Clearinghouse reports a total number of known records that have been compromised 

since 2005 through last week topped 535 million. 

Increasingly, identity thieves are aiming their sights on children. 

There were 19,000 cases of child identity theft reported to the FTC 

in 2009 a 192 percent increase since 2003. From the criminal’s 

point of view, children provide easy targets since they have no debt 

history and no reason to check their credit cards. 

Child ID thieves may operate undetected for years until the child 

applies for driver’s license, credit card or jobs and learns their ID 

has been compromised. In some very sad cases, the child is a victim 

of a relative. In the meantime, children of all ages whose Social Security number has been compromised may have a record of credit 

card debt, mortgage default or falsified employment. 

As we will hear from the Director of the Federal Trade Commission, Southwest Region today, the FTC has recently intensified its 

work regarding the growing problem of child identity theft, gathering experts and law enforcement officials last month for the first 

time ever conference on child identity theft. 

And we will gain some insights on the identity thieves themselves based on the research of one of our own University of Texas 

at Dallas professors who will share the results of her interviews 

conducted with ID thieves. Lastly, we will hear from the local 

agents from the Social Security Administration Office of the Inspector General about their successes and challenges as they work to 

apprehend ID theft cases. 

Congress needs to finish its work on ID theft. Previously, bipartisan legislation has been passed by the Ways and Means Committee to protect the privacy of Social Security numbers and prevent identity theft. While progress has been made, because Social 

Security number use is so widespread, and there are several Committees of Jurisdiction, we have yet to reach agreement on the 

right ways to limit SSN access. 

In the mean time, this Committee can make progress by removing Social Security numbers from Medicare cards. To that end, I 

have introduced with my Texas colleague, Lloyd Doggett, the Medicare Identity Theft Prevention Act. 


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The risk of ID theft goes far beyond the card being stolen. Every 

medical record at doctor’s offices, hospitals and nursing homes has 

a Social Security number written on it. The fact that millions of Social Security numbers are readily available to identify thieves for 

the taking is kind of unbelievable. 

The Centers for Medicare and Medicaid Services have refused to 

act; and if they won’t do right for America’s seniors, we will try. 

With the help of information gathered from our witnesses today, 

we can also do what’s right for children and help protect them from 

ID theft. 

I thank all of you for being here today and sharing with us the 

information that you have. As is customary, any member of this 

committee is welcome to submit an opening statement for the 

record; but before we move on, I want to remind our witnesses to 

limit their oral statements to five minutes. And without objection, 

all written testimony will be made part of the permanent record. 

Chairman JOHNSON. We have one panel today and our witnesses who are seated at the table are: Stanley Lanius from Plano. 

Raise your hand. 

Ms. LANIUS. Stacey. 

Chairman JOHNSON. Stacey it is. Excuse me. I was looking for 

a guy and it’s a girl. Thank you for being here, ma’am. I apologize. 

Steve Bryson from Allen; and Deanya Kueckelhan, Director 

Southwest Region, Federal Trade Commission from Dallas; and 

Lynne Vieraitis, Ph.D. Associate Professor of Criminology in the 

University of Texas, Dallas in Richardson; Robert Feldt, Special 

Agent In-Charge, Office of the Inspector General, Social Security 

Administration, Dallas. And Mr. Feldt is accompanied by Antonio 

Puente, Special Agent from the Dallas Field Division in San Antonio. And now we will proceed. 

Ms. Lanius, welcome. You may proceed. 

STATEMENT OF STACEY LANIUS, PLANO, TEXAS 

Ms. LANIUS. Chairman Johnson, Members of the Subcommittee, 

thank you for inviting me to testify today about my personal experience with identity theft. 

During 1986, I was a sophomore at the University of Texas at 

Austin. At that time, I was using my maiden name Stacey Rogers. 

An organization on campus was doing a fundraiser that involved 

credit card application. There were groups of five applications and 

the organization made money off of each group of cards that an individual applied for. The cards were MasterCard, Neiman Marcus, 

Sears, Zales Jewelry Store and Dillard’s. I remember. 

I asked my parents if I could apply for the cards to help my 

classmate with her fundraising project. My parents thought this 

was a good idea so that I could start building a credit history. Of 

course, they cautioned me about overusing the cards. I completed 

the five applications but never heard anything back. I was not worried. I assumed that because I was a full-time student with limited 

income the companies had denied my application. 

Two years later, I made a purchase in Dillard’s department store 

and paid by check. The clerk denied my check and told me I had 

to go to Customer Service. At Customer Service, I was told that I 

had exceeded my limit on my Dillard’s credit card and was behind 


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on my payment. I told the clerk I didn’t have a Dillard’s credit card 

and asked to see the transactions on the account. There were numerous transactions on the account spanning two years. 

I was able to obtain copies of the receipts for these purchases 

and on one single receipt the store clerk had asked for a driver’s 

license so there was a driver’s license number for me. My father 

was an FBI agent and I asked him to run the license and we discovered that a woman who shared my name, Stacey Rogers, was 

the one who made the purchases. 

At the time, there was no Internet so I drove to the credit bureaus and requested copies of my credit report. This woman had 

somehow intercepted the five credit card applications for which I 

had applied two years before. She changed the address on the accounts so that when the cards were issued, they went straight to 

her. I never knew I had been approved for the cards. My best guess 

at the time that was that she worked at the business that processed the applications, saw that we shared the name and altered 

the applications. She also kept my Social Security number for future use. 

On my credit reports, those five accounts were charged to the 

max and were all delinquent. Additionally, she had used my Social 

Security number to apply for more credit and financing. There were 

thousands of dollars in charges and numerous delinquent accounts 

on my credit history due to this theft of my identity. 

In 1988 when I graduated and went to work for KPMG, my poor 

credit history followed me as it did for years; when I tried to get 

my first apartment lease, when I tried to purchase my first car, 

when I tried to actually apply for a credit card. And someone, the 

other Stacey Rogers, continued to use my Social Security number 

to finance everything from televisions to surgeries. 

Each time I would go to a vendor to explain the problem or go 

to the credit bureaus to get the fraudulent purchases off my credit 

report, I was told that I needed to prove I had not made the purchases. How does one go about proving such a negative? I diligently 

visited every credit bureau, circling the accounts I claimed were 

fraudulent. The accounts stayed on my record, but a note was 

added there was a claim of fraud on the account. 

In 1991, I married and my legal name changed. Several years 

later I finally noticed a decrease in fraudulent activity. I now have 

an excellent credit rating, have successfully financed the purchase 

of two homes and am free of the effects of the identity theft. However, the stress that that caused was tremendous occurring at a 

point in my life when I was just getting started as an adult. I now 

guard my Social Security number very carefully and try to check 

my credit on an annual basis. 

Mr. Chairman, thank you again for this opportunity to share my 

story. I would be happy to answer any questions you or the other 

members may have. 

Chairman JOHNSON. Thank you, ma’am. We appreciate you 

being here. We’ll postpone the questions until everyone has testified. 

[The prepared statement of Ms. Lanius follows:] 


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Chairman JOHNSON. Mr. Bryson, you’re recognized. Five minutes. 

STATEMENT OF STEVE BRYSON, ALLEN, TEXAS 

Mr. BRYSON. Thank you, Mr. Chairman. I would like to thank 

Congressman Johnson and the Members of the Subcommittee for 

allowing me to tell my family’s story concerning identity theft. 

A couple years ago my 17-year-old stepdaughter applied for a 

lifeguard job at a church camp in a summer job in Tyler, Texas. 

One of the prerequisites of this job was a simple background check 

of all employees by using Social Security numbers. This was done 

through the Safe Churches Project of Safe Advantages Services, 

which is a member of the First American family of companies. 

My daughter submitted her Social Security number to the church 

and a background check was run. A few weeks later, we received 

a result of that check and were shocked to that find her Social Security number was being used by six to seven people in California, 

Nevada and Texas. In one case, two people living at the same address in Houston, Texas were using this number. 

The Social Security number was assigned to her when she was 

born February 12, 1993; and since she was a minor, there was no 

reason for us to monitor or have any issue with it. Upon learning 

about this number of people, my wife contacted the local Social Security office here in Collin County and was informed that since she 

was a minor, there was very little they can help with. 

I contacted a friend of mine in Tyler, Texas who’s a retired FBI 

agent and he said that there was very little the Federal Government could or would do to help, and he said the only recourse we 

had was to contact the various credit agencies around the country 

and to send letters to the police and sheriff’s departments in the 

cities where these individuals lived. 

We contacted the credit rating agencies first and found that 

there was very little help due to the fact, again, that she was a 

minor. They did not even have her listed. At the time, we felt that 

there was no help and attempts to monitor or control. This was 

useless. It would cost a lot of money and a lot of time. 

It’s my opinion that her Social Security number was purchased, 

that these people purchase these numbers and that most probably 

they were here in the United States illegally. Identity theft is a 

crime whether you are buying, selling or using the Social Security 

number. This is a problem that seems to be growing daily. And I’m 

concerned that this is not being made a top priority by the Federal 

Government. 

Chairman Johnson, I have no idea how this—what definitive impact this will have on my daughter now or in the future, but I do 

feel like at some point in time this will come up. In the mean time, 

there are at least six people who are out using her Social Security 

number who obtain jobs, credit, loans, possibly some type of benefits under Social Security. 

Mr. Chairman, in conclusion, I do not believe that it should be 

the sole responsibility of the individual who is the victim of identity 

theft to attempt to correct these problems. I thank you again for 

your time and the Committee. 


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Chairman JOHNSON. Thank you, sir. I agree with you, we need 

to help you if we can. That’s why we’re having this hearing today. 

[The prepared statement of Mr. Bryson follows:] 


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Chairman JOHNSON. Ms. Kueckelhan, welcome. You may proceed. 

STATEMENT OF DEANYA KUECKELHAN, DIRECTOR, SOUTHWEST REGION, FEDERAL TRADE COMMISSION, DALLAS, 

TEXAS 

Ms. KUECKELHAN. Thank you, sir. Chairman Johnson, Congressman Brady and Congressman Marchant. I’m Deanya 

Kueckelhan, Director of the Federal Trade Commission, Southwest 

Region, located here in Dallas and actually a native Texan. I have 

the privilege today of presenting the Federal Trade Commission’s 

remarks on child ID theft. 

It is so unfortunate to hear the two stories that were just told. 

We’ve just heard that our children do become victims of identity 

theft. Identity thieves steal, deliberately steal a child’s ID. They 

fabricate a Social Security number coincidentally that sometimes 

belongs to a child and they do that to obtain employment, to receive government benefits or to obtain a loan for credit. The Federal Trade Commission’s 2010 Consumer Signal Network Data 

Book shows that Texas ranks 5th among the states in ID theft 

complaints after Florida, Arizona, California and Georgia. And 

that’s with over 24,000 complaints filed in the year of 2010 alone. 

A non-FTC study shows that 142,000 instances of identity fraud 

are perpetrated on minors in the U.S. each year. So child identity 

theft is especially harmful, though, Chairman Johnson, because it 

can go on so long undetected, until a child becomes an adult and 

perhaps applies for a college loan or a car loan or seeks employment. 

For this and other reasons, the Federal Trade Commission and 

DOJ’s Office For Victims of Crime recently co-hosted Stolen Futures: A Forum On Child ID Theft on July 12th, 2011, this summer 

in Washington. We gathered panelists such as educators or child 

advocates and representatives of government agencies in the private sector as well as legal service providers and they discussed 

how to deter and remedy child ID theft. 

Panelists noted, among many other things, that identity thieves 

steal a child’s ID from schools, from businesses, from government 

agencies and, unfortunately, panelists also discussed the fact that 

sometimes friends and desperate family members will use the ID 

of a child in hard economic times when they have a lack of access 

to credit. They become desperate to use that child’s social security 


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number in order to pay basic services such as heat or electricity or 

other utilities. 

Panelists also talked about sensitive health information, particularly related to the foster care system. Panelists stated that in the 

foster care system a child’s information is circulated through the 

Social Services network as well as in school records which makes 

foster children particularly vulnerable to child ID theft. In essence, 

a child’s ID is a blank slate and because of the unique qualities of 

child ID theft, oftentimes makes it more valuable to steal a child’s 

ID than an adult’s ID. 

Panelists also noted, as did Mr. Bryson, that the challenge this 

causes because parents don’t routinely check a child’s credit primarily is that children don’t have a credit history; thus, parents 

have no reason to suspect a problem. One possible solution was 

mentioned by a panelist from the Utah Attorney General’s Office, 

who described a proposed Utah initiative that would enable parents to enroll their child in a state identity protection program. 

Utah would pass the child’s information on to TransUnion, which 

would in turn place a high risk alert on the child’s name and information. 

Panelists throughout the day stressed prevention. Controlling 

and limiting access to a child’s information is one of the best ways 

to deter child ID theft. Panelists recommended that parents and 

guardians and foster care parents challenge routine request for 

their children’s ID. Shall I go on? 

Chairman JOHNSON. Continue. 

Ms. KUECKELHAN. Thank you. Panelists also suggested that 

parents learn how their children are using the Internet and Social 

media because children sometimes innocently divulge their personal information that could be used to commit ID theft. Panelists 

also encouraged increased outreach to foster care workers and directly to the foster youth, especially the older teen foster youth who 

are about to enter the adult world and exit the foster care system. 

The FTC’s primary goal in co-hosting Stolen Futures was to 

learn more about this problem and develop messages for outreach. 

The FTC has already prepared new educational materials. I’m 

proud to say, they’re already being distributed. We consulted with 

DOE on a back to school alert. We have it today on one of the tables upstairs. We will continue to distribute these. And I’m happy 

to answer questions. 

Chairman JOHNSON. Thank you, ma’am. 

Ms. KUECKELHAN. Thank you. 

Chairman JOHNSON. You know, a lot has started when we 

started giving out numbers at birth. And, you know, I don’t know 

how many babies get credit, but I doubt very many of them do, and 

so that’s caused a lot of problems. We’re looking at that aspect of 

it, too. 

[The prepared statement of Ms. Kueckelhan follows:] 


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Chairman JOHNSON. Dr. Vieraitis, welcome. Please go ahead. 


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STATEMENT OF LYNNE M. VIERAITIS, PH.D., ASSOCIATE PROFESSOR OF CRIMINOLOGY, UNIVERSITY OF TEXAS AT DALLAS, RICHARDSON, TEXAS 

Dr. VIERAITIS. Thank you. Chairman Johnson, Members of the 

Committee, thank you for inviting me to discuss my research on 

identify theft at this hearing today. By presenting the perspectives 

of offenders, I hope to provide the Committee with a more comprehensive picture of identity theft, one that may offer suggestions 

of how it might be better controlled. 

The 9/11 highjackers, a single mother in Texas addicted to methamphetamine, a married father of three and college graduate, the 

girlfriend of a gang member of one of the most notorious Latin 

American gangs operating in the United States, they appear to 

share little in common. The one thing they do share is they were 

all identity thieves. 

I’m often asked to describe the typical identity thief; but as the 

aforementioned profiles suggest, it is difficult to paint a portrait of 

a typical one. The identity thieves we spoke with came from all 

walks of life and had diverse criminal histories. Their backgrounds 

ranged from upper to lower class, the unemployed to employed, 

from day laborers to professionals, middle school drop-outs to college graduates and from those with lengthy criminal histories to 

first-timers. 

We found that some thieves worked alone while others were involved in teams of up to 30 members. Some were fueled by their 

addictions to illegal drugs while others simply wanted to live above 

their means or meet day-to-day living expenses. The diversity in 

their backgrounds and current lifestyles influenced the ways in 

which they chose to carry out their crimes. 

So how do they steal information and what do they do with it? 

Those who worked alone typically used personal information of others to open credit card accounts or secure bank loans. In some 

cases, they used information available to them from their place of 

work. In some cases they used the information of family members, 

including their own children and friends. Other thieves used more 

sophisticated and elaborate schemes to dupe strangers into revealing their information. For example, one set up a fake employment 

site with applicants willingly supplying their information. 

The majority of the identity thieves we interviewed operated in 

teams. Street level identity theft rings, or SLIT rings for short, relied on numerous methods to steal and convert information. Some 

rings paid employees of companies to get information on clients or 

customers. Others targeted residential and commercial mailboxes, 

but most SLIT rings bought their information from another streetlevel criminal who was typically engaged in drug sales, robbery, 

burglary or other street crimes who sold the information to the ring 

leader. This information included driver’s licenses and Social Security cards stolen from homes or cars. Some ring leaders claim that 

acquaintances, friends and family members provided their information in exchange for a fee. 

After stealing a victim’s information, offenders applied for credit 

cards in the victim’s names, opened new bank accounts, deposited 

counterfeit checks, withdrew money from existing bank accounts, 

applied for loans and opened utility or telephone accounts. 


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Such transactions also require some form of official identification. 

To produce these documents, teams recruited employees of state or 

federal agencies with access to Social Security cards or birth certificates which were then used to order identification cards. They were 

also able to manufacture false cards using rogue employees of state 

departments of motor vehicles or other street hustlers who had 

managed to obtain the necessary equipment. 

Members of occupational teams use their legitimate place of employment to steal information and convert it to cash or goods acting 

almost exclusively with fellow employees to commit their crimes. 

In addition to the question of how they do it, I’m often asked why 

they do it. The simple answer: It’s quick and easy money. But the 

answer is more complex. 

What we found when we spoke to offenders was that they engage 

in identity theft because they see it not just as financially rewarding but emotionally rewarding as well. They believe it to be relatively low in risk and find it easy to justify or excuse their actions. 

In short, they perceive the rewards to be high and the risks low. 

The identity thieves we spoke with were confident in their ability 

to profit from their crimes and to avoid detection; despite the fact 

we were speaking to them while they were incarcerated. Most 

didn’t focus on the risks of crime, but all actively engaged in strategies to reduce the likelihood of detection by victims, law enforcement and financial institutions, including reducing the number and 

amount of transactions they conducted per identity. They selected 

certain times, persons and places to cash in and tried to blend in 

as much as possible. 

The crime of identity theft includes the acquisition of information 

as well as the use of that information. But there are several points 

along that crime continuum that can be addressed with policy. The 

challenge for policy makers and law enforcement is identifying policies and strategies that can target these weak points while at the 

same time allowing business and customers to conduct transactions. 

Several suggestions for prevention are provided that draw upon 

several well known situational crime prevention techniques. Each 

of these strategies is more effective when they can be catered to 

highly specific forms of identity theft, for example, child identity 

theft versus adult and identity theft committed by loaners versus 

those committed by SLIT rings. 

We must increase the effort and risk of obtaining information. 

We need to continue to promote awareness of identity theft and 

educate citizens on how to protect that information, and we may 

need specific guidance for parents to protect their children. We 

need to educate consumers on what to do when their identity is stolen and when it’s used and encourage them to report to law enforcement. The National Crime Victimization Survey indicates that 

only 17 percent of the victims in their study reported it to law enforcement. We need to reduce unsafe business practices. Institutions that have data on children, including hospitals and schools 

should be particularly vigilant and we need to provide alternatives 

to agencies dealing with special populations, such as children in 

the foster care system. 


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We need to increase the effort and risk of converting information. 

Systems should be in place to verify and alert credit granting agencies and employers who verify employment eligibility that a Social 

Security number is issued to a person under the age of 18. 

Chairman JOHNSON. Can you summarize? 

Dr. VIERAITIS. I’m sorry? 

Chairman JOHNSON. Can you summarize? Your time has expired. Can you summarize? 

Dr. VIERAITIS. Yes. Increase the risk of getting caught. Very 

briefly, what we need to know, identity theft and perhaps child 

identity theft in particular poses a challenge for law enforcement. 

We need to know more about identity theft and those who commit 

it and be better and more consistent in measures of identity theft 

and fraud, specifically frauds that target children. 

We need more systematic data collection from agencies responsible for personal information, agencies that use it, law enforcement agencies and from victims and from those who know most 

about how and why identity theft occurs, the identity thieves themselves. Thank you. 

Chairman JOHNSON. Thank you. 

[The prepared statement of Dr. Vieraitis follows:] 


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Chairman JOHNSON. Mr. Feldt, I understand you and Mr. 

Puente are going to share the time. 

Mr. FELDT. Yes, sir. 

Chairman JOHNSON. Thank you. You may proceed. Thank you. 

STATEMENT OF ROBERT FELDT, SPECIAL AGENT-IN-CHARGE, 

OFFICE OF THE INSPECTOR GENERAL, SOCIAL SECURITY 

ADMINISTRATION, DALLAS FIELD DIVISION, DALLAS, TEXAS, 

ACCOMPANIED BY ANTONIO PUENTE SPECIAL AGENT, DALLAS FIELD DIVISION, SAN ANTONIO, TEXAS 

Mr. FELDT. Good afternoon, Chairman Johnson, Members of the 

Subcommittee. My name is Robert Feldt. I’m the Special Agent InCharge for Social Security OIG’s Dallas Field Division, which handles Social Security fraud investigations in Texas and four other 

states. Thank you for the invitation to testify today. 

According to identity theft experts, identity thieves target child 

Social Security numbers because a child’s SSN is usually issued at 


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birth and not used for credit purposes for about 18 years. This allows for the potential long-term undetected abuse of a legitimate 

SSN, and the potential long-term harm to a young person’s financial future. 

We in the OIG appreciate the concern your Subcommittee has for 

families and their children with regard to identity theft, and we 

pursue as many SSN misuse cases as our resources allow. We receive thousands of SSN misuse allegations each year. Our agents 

participate in SSN issues task forces across the country investigating identity theft, as well as mortgage, bankruptcy and benefit 

fraud. 

In fiscal year 2010, we had more than 400 SSN misuse cases 

that resulted in criminal conviction. Some of our most fulfilling 

cases are those that lead to the arrest of an individual who used 

someone else’s SSN to collect Social Security benefits, because 

we’re able to repair a person’s identity and recover stolen agency 

funds. 

Our agents have also recently reported a relatively new SSN 

issue scheme involving credit privacy numbers, or CPNs. These 

nine-digit numbers are sold by dishonest organizations usually on 

the Internet, to individuals with poor finances, with the promise 

the numbers will allow the individuals to create a new credit file. 

But consumers should know CPNs are not legal identification numbers. In fact, they are usually stolen SSNs, particularly those belonging to children, for the reasons I’ve mentioned. 

Our investigative and audit work has taught us that the more 

SSNs are used in day-to-day transactions, the higher the probability these numbers can be stolen and used to commit crimes. 

We’ve made many recommendations to SSA related to SSN integrity, and we support this Subcommittee’s efforts to limit the use 

and display of the SSN. That information is detailed in my written 

statement for the record. 

In conclusion, OIG’s investigators are committed to pursuing 

SSN misuse and identity theft cases. Our auditors and attorneys 

will also continue to make recommendations to your Subcommittee 

and to SSA to improve the integrity of SSNs, especially those belonging to children. 

Thank you again for the invitation to testify. I will yield my remaining time to Special Agent Antonio Puente. 

[The prepared statement of Mr. Feldt follows:] 


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Chairman JOHNSON. Mr. Puente. 

Mr. PUENTE. Good afternoon, Chairman Johnson and Members 

of the Subcommittee. My name is Antonio Puente and I’m a Special 

Agent in SSA OIG’s Dallas Field Division working out of the San 

Antonio office. Thank you for the invitation to testify. 

Identity theft is prevalent in Texas for several reasons. First, the 

Pew Hispanic Center estimates there are about 1.65 million unauthorized immigrants in Texas. These individuals may seek other’s 


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personal information, like Social Security numbers, for reasons 

such as gaining employment and applying for government benefits. 

Also, identity thieves have relatively easy access to other’s personal information. Many fraudulent vendors offer stolen or fabricated identity documents for a fee. I want to share a recent identity theft case that my office and other law enforcement agencies 

investigated near Austin. 

Last year, Pflugerville police learned that care takers in an area 

nursing home might have submitted false identity documents to 

gain employment. We verified SSNs of 43 employees suspected of 

submitting fraudulent personal information. The search revealed 

that 28 of the employees did, in fact, misuse an SSN. Twenty-three 

people were arrested. All of them pleaded guilty to buying a Social 

Security card from an unknown document vendor in the Austin 

area. In June, they were fined and sentenced to time served. 

The Department of Homeland Security identified these individuals as Mexican nationals unlawfully present in the United States, 

and they are currently in deportation proceedings. Before this investigation, the nursing home did not use Homeland Security’s 

eVerify system to determine the employee’s eligibility to work in 

the United States. I met with corporate officials and provided instructions for using the eVerify system. 

Also, the investigation revealed seven of 28 fraudulent SSNs belonged to children. The case shows that it’s critical for parents to 

protect their children’s Social Security cards and monitor their 

SSNs. In closing, I want to thank the many law enforcement agencies that contributed to this investigation, especially the 

Pflugerville police. 

Thank you for the invitation to testify, and we’ll be happy to answer your questions. 

Chairman JOHNSON. Thank you, sir. 

Mr. PUENTE. Yes, sir. 

[The prepared statement of Mr. Puente follows:] 


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Chairman JOHNSON. We’re trying to push E-verify into all companies now, and I hope that makes a difference. I don’t know if it 

will or not. Because they don’t all use it right, you know that. 

Mr. PUENTE. Yes, sir. 

Chairman JOHNSON. As discussed, the time for each round of 

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leagues to also limit their questions to five minutes and any remarks that you care to make will be entered in the record. 

Mr. Bryson and Ms. Lanius, were either of you aware of the 

crime of identity theft when you or your family became victims? 

Mr. BRYSON. No, sir, I was not. 

Ms. LANIUS. No. 

Chairman JOHNSON. And had you heard of any precautions 

that you needed to take to protect your family’s Social Security 

number. 

Ms. LANIUS. No. 

Mr. BRYSON. No. 

Chairman JOHNSON. No one advised you of that? Did both of 

you know where to go for help once you knew it occurred? 

Mr. BRYSON. No. 

Chairman JOHNSON. How did you find out, either one of you? 

Ms. LANIUS. I talked to the police and they told me there’s really nothing that could be done because I had to prove I hadn’t made 

those purchases. And I drove, because back then there was no 

Internet, to all the credit bureaus, and I had to drive to all the vendors begging them to stop reporting these purchases under my Social Security. 

Chairman JOHNSON. And they wouldn’t help you? 

Ms. LANIUS. No one would help, no. The burden was on me and 

no one—no one would help. There was no place to go. 

Chairman JOHNSON. Do the credit guys help now? 

Okay. Thank you, Ms. Lanius. What did you do finally to prove 

that you didn’t make these purchases? How did you finally get out 

from under that? 

Ms. LANIUS. I did not. I could only circle the items on the credit 

report that I was claiming were fraudulent. The credit agency at 

that time would put a note under those saying that the person— 

the account had claims this was a fraudulent purchase, but they 

still stayed on my report for seven years, and it still went into my 

credit rating for seven years. And that was the only thing I could 

do. I did speak to the doctor’s office who called me to collect on a 

surgery she had had. 

Chairman JOHNSON. Wow. 

Ms. LANIUS. And they said all I could do was go in and prove 

by examination that he hadn’t operated on me, and I was wasn’t 

going to do that. So the surgery went on my credit history as well. 

Chairman JOHNSON. That’s almost insurmountable. I don’t understand that. 

Agent Feldt, would you explain what steps Social Security employees are instructed to take to help victims? 

Mr. FELDT. Yes, sir. SSA has processes in place to assist victims 

of identity theft. SSA personnel will work with identity theft victims to do several things. First, SSA will review the earnings reported under the SSNs and correct the record, if necessary. 

Chairman JOHNSON. Well, but in her case they didn’t do it. 

Was Social Security not working at that point in time? 

Mr. FELDT. These policies were probably not in place at that 

time. 

Chairman JOHNSON. Okay. 

Mr. FELDT. That’s correct. 


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Chairman JOHNSON. So you’re saying this couldn’t happen 

again. 

Mr. FELDT. I would not be bold—so bold as to say that. 

Chairman JOHNSON. Okay. 

Mr. FELDT. They also have a few other procedures in place to 

help individuals if they’ve lost a card to retain a replacement card, 

and also to provide information to victims about the FTC and help 

they can provide. Also, although it’s not an item that’s used very 

often, they will take an application for a new Social Security number. However, the victim must prove they’ve been harmed in that 

situation. 

It is frowned upon to do that because ultimately if that—if that 

step is taken, the Social Security numbers and the record will come 

together in time through the credit bureaus. So that’s not very effective and it’s discouraged. And lastly, employees will develop aspects of fraud in the matter and potentially refer it to the OIG for 

investigation. 

Chairman JOHNSON. Thank you. 

Mr. FELDT. Yes, sir. 

Chairman JOHNSON. I think my time’s expired. 

Mr. BRADY. Chairman, thank you very much for holding this 

hearing. For the audience, from the first day I got to Congress, 

Chairman Johnson was an early and very vocal proponent regarding our Social Security ID numbers and shining a light on identity 

theft, so thank you. I had no idea the amount of child identity theft 

was occurring before you scheduled this hearing and as a parent 

to young boys, I’m more nervous than ever as a result. 

One of my frustrations on this committee and on these hearings 

has been how rare it is to—for an identity thief to be apprehended 

and prosecuted. It seems each week I pick up the newspaper, I see 

prosecution of Medicare frauds, securities fraud, consumer fraud. I 

can’t remember the last time I saw a report of identity theft actually have been prosecuted. 

Ms. Lanius and Mr. Bryson, you both contacted law enforcement, 

I assume not satisfied with the result of that contact. So I wanted 

to ask Ms. Kueckelhan and Mr. Feldt, you know, give us perspective. What are the chances in America that an identity thief will 

be apprehended and prosecuted? 

Ms. KUECKELHAN. Congressman Brady, I can say the Federal 

Trade Commission, since 2001, has brought 34 data breach law enforcement actions and that is where massive breaches of Social Security numbers have occurred. And we will continue to bring those 

types of law enforcement actions. 

I’m also pleased to mention that we have brought the first mobile 

app misrepresentation case, filed on August the 15th. It’s the first 

such case that a federal agency has brought. We brought it against 

a mobile app provider who obtained children’s information and 

used that information and distributed it without the parents’ consent. 

So we in our law enforcement area, if you’re asking about that, 

we work more from the data breach than the bigger perspective. 

We also provide education and support to legal aid entities who 

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Mr. BRADY. Can I ask you, in these cases, there wasn’t a data 

breach, so the Federal Trade Commission would not—is not or 

would not be pursuing cases that affected Ms. Lanius and Mr. 

Bryson. 

Ms. KUECKELHAN. We do not represent one individual in a private case. For a misrepresentation case, we look for a pattern and 

practice and that’s why we take on the large data breach cases. 

Generally speaking, individual ID theft victims are assisted by 

legal aide representatives. In addition, the FTC provides consumer 

materials and online information for self help, including assistance 

with affidavits and letters. 

Mr. BRADY. Mr. Feldt. 

Mr. FELDT. Yes. We—as far as challenges, there’s—— 

Mr. BRADY. What are the chances in SSA’s view that someone 

who commits this crime will be apprehended and prosecuted? 

Mr. FELDT. We work cases every year as an organization in 

which folks are apprehended. 

Mr. BRADY. And I’m not being—I’m just trying to get a perspective. 

Mr. FELDT. Yes, sir. 

Mr. BRADY. Would it be fairly rare. 

Mr. FELDT. I don’t know what the percentage would be of allegations of SSN misuse that actually result in a conviction. But I 

would agree with you that it would be—it is rather rare. There’s 

a lot of misuse of Social Security numbers going on that ultimately 

is not prosecuted. 

Mr. BRADY. What more can be done? Clearly Congressman and 

Chairman Johnson focus on prevention early on in protecting the 

integrity of these numbers, but, you know, what needs to be done? 

New laws? New resources? I don’t know. 

Ms. Lanius, did they ever apprehend this Stacey Rogers? 

Ms. LANIUS. No. 

Mr. BRADY. Never. Did they—Mr. Bryson, any of the six or 

seven or eight, do you know of—— 

Mr. BRYSON. No, sir. 

Mr. BRADY. What do we need to do. 

Mr. FELDT. Number one, doing anything we can do to prevent 

the disclosure of Social Security numbers and any enhancements 

that can be made, we would support. And additional resources can 

always help. To have more feet on the ground to investigate identity theft, would be a good thing. 

Actually, so many of the cases that are prosecuted, they will 

start at the local level in which they start with a local complaint 

to a police officer, and then you have jurisdictional issues in many 

times. And we get referrals from local police offices and at the local 

level that many times result into federal convictions. 

Mr. BRADY. Dr. Vieraitis, did the folks that you interviewed, did 

they—as they were committing the crime, did they think they were 

gonna get away with it? 

Dr. VIERAITIS. They were very confident in their abilities and 

they thought they would get away with it. And even though we 

spoke to people who were sitting in prison, so clearly they did not 

get away with it, they blamed their capture on outside things they 

deviated from the plan, dumb luck on the part of law enforcement, 


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or they were working with others who got caught up in the trafficking. 

Mr. BRADY. The times I—and I appreciate that, FTC, Social Security ID, get frustrated. I wish we’d spend a little less time pursuing celebrity sports cases and a little more time as a government 

focusing on identity theft. I think we’d actually help a lot more people. 

Ms. KUECKELHAN. Congressman Brady, the Federal Trade 

Commission has civil authority. We have no criminal authority. 

Chairman JOHNSON. Well, that’s true, so can you answer the 

question for me: How many of those cases were children below the 

age of, let’s say, 18. 

Ms. KUECKELHAN. The data breach numbers? 

Chairman JOHNSON. Yeah. 

Ms. KUECKELHAN. I don’t have those numbers. And also, it’s 

important to note on the 192 percent that you stated, Chairman 

Johnson, although that is an accurate percentage of the increase in 

child identity theft complaints for which the person reporting completed the field that ask for the victim’s name, many consumers do 

not disclose the victim’s age. Therefore, that is not based on a scientific survey. It is instructive, but not scientific. 

On our complaint system there is a field that ask for the child’s 

age at the time that they were victims. Many of those that report 

do not include an age. 

Chairman JOHNSON. They don’t fill it out. 

Ms. KUECKELHAN. No, sir. 

Chairman JOHNSON. How about, Feldt, do you know what percentage are under the age of 18 when they’re stolen. 

Mr. FELDT. I’m sorry, I do not know the number. We can sure 

get that back to you. 

Chairman JOHNSON. We give SSNs to them when they’re born 

nowadays for goodness sake and I’m telling you, I don’t know of a 

baby in the world that’s gonna go and check his credit. 

Ms. KUECKELHAN. Chairman Johnson, of those that did report 

an age in 2010, over 24,000 were under the age of 19. 

Chairman JOHNSON. Okay. Well, that’s a good statistic. Thank 

you very much. Mr. Marchant. 

Mr. MARCHANT. Thank you, Mr. Chairman, for the opportunity 

to participate in this hearing. I have a formal statement I’d like to 

submit to the record. I also would like to submit to the record a 

Wall Street Journal story that was written this week, August 27, 

about a family in Dallas who had had their children targeted by 

identity thieves. So it’s a very timely article, and it’s about a local 

family. 

What got me interested in this was a case that came into our 

congressional office about a family who had applied for this Social 

Security card for an infant, a new-born infant. And I know my son, 

when his children were born, he—one of the first things he did was 

he applied for a Social Security card. And this family that I represent applied for their Social Security card. 

And after a while, they had not received it so they began to look 

into why they had not received it, and then they were contacted by 

the police who were doing a very good job, and they notified them 

that, in fact, the Social Security card had been removed from their 


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box out in front of their house. So they were harvesting the mail 

in this neighborhood. 

They got the Social Security card. They began to use it. And only 

through that mechanism did this family find out not only, you 

know, here’s why you didn’t get your card; but that’s one bad news. 

The next part of the bad news is your child was already very deeply in debt and has a very bad credit rating, even though they 

haven’t achieved their first birthday. 

So we began to work on some legislation. With the Chairman’s 

permission, we will pursue the legislation when we get back to 

Washington. And the objective of our legislation will be, first of all, 

to come up with a more secured delivery system of that first Social 

Security number. I think that in itself would cut down a lot of the 

abuse and fraud of not putting that in the mailbox when we have 

the ability to get a secure number over the Internet. There are a 

lot of ways to secure this valuable number without having it put 

in your post office box. 

The second thing we would like to accomplish is when you have 

a card issued to an infant and if it’s brought to the Social Security 

Administration’s attention that that has already been stolen and 

compromised, there needs to be a standard process of issuing a new 

number to that infant or child. There also needs to be a standard 

system where that old number goes into the Social Security system 

and is flagged. And if there’s any activity on that number, any income activity, a big red flag needs to just pop up. And you’ll have 

an immediate printout of here of your fraud cases. 

I mean, that to me, that is just a mechanical process that can 

be done. Then I think you can come to Congress and say, okay, 

here’s our list. Give us the boots on the ground to just go enforce 

this law. I don’t see any mechanism on the books now to even to 

accomplish this process. So we’re gonna try to help you with permission from the Chairman. We’re gonna try to help you with that 

system. 

And then I think that we have to notify parents somehow or another when they apply for a card for a minor, they need to get some 

immediate information back from the Social Security Administration. When they get that number, they need to immediately be apprized of the problems that they’re going—that they can have and 

the importance of it. 

It’s almost a gift to the criminal world the way that we operate 

this system. And if there was somebody in this audience today that 

was trying to learn how to easily get into this system, I think they 

have a pretty clear roadmap of how to do it. They have a pretty 

clear roadmap of the very rare odds of them being apprehended 

and how very lucrative this can be. 

We can do this. We’ve got super computers. We’ve got dedicated 

people in the field that are willing to enforce this. We’ve got parents. We’ve got agencies who are willing to solve this. I think it’s 

incumbent on our Committee, Mr. Chairman, to give them the tools 

and the direction they need. 

Chairman JOHNSON. Thank you. I think we’re looking at that 

for starters—why do we give babies at birth a Social Security number? I’m kind of in favor of stopping that. We’ve discussed that a 

little bit yesterday. 


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Mr. FELDT. Yes, sir. 

Chairman JOHNSON. Thank you. Dr. Vieraitis, you’ve done 

some interesting work in reviewing ID theft criminals and from 

that research, what approaches did they use to commit the crimes? 

Dr. VIERAITIS. How much time do I have. 

Chairman JOHNSON. Not too much. Try to synthesize it. 

Dr. VIERAITIS. All the ways that you hear about, they use. They 

will steal from mailboxes. They will target dumpsters outside businesses such as insurance companies or schools that don’t properly 

dispose of their data or files. They pay company employees, American Express or Visa or home mortgage companies. 

They work with other street offenders who are involved in drug 

sales who know drug addicts who are willing to sell their own information in exchange for money. 

Chairman JOHNSON. Well, when you say they pay employees of 

American Express or Visa or somebody, what do you mean? 

Dr. VIERAITIS. They just happen to know someone who’s working there. In exchange for money, the employee will give them information of people in their data base. 

Chairman JOHNSON. So those credit companies have been cooperative. 

Dr. VIERAITIS. There have been employees of credit companies, 

yes, that have sold information. 

Chairman JOHNSON. Have you run into that. 

Dr. VIERAITIS. Yes. 

Chairman JOHNSON. Mr. Feldt. 

Dr. FELDT. Yes, sir. 

Chairman JOHNSON. Okay. Well, where do you think that we 

might go next to try to stop this other than stopping a number at 

birth. 

Dr. VIERAITIS. I think that the FTC has done a fabulous job 

educating consumers and potential victims on how to protect their 

data. I don’t know if the majority of people get that information. 

There are probably people who simply don’t know and aren’t aware 

of it. So constantly increasing awareness of it and encourage people 

to report. 

People don’t report to law enforcement; and if people don’t report 

to law enforcement there’s not as much we can do if we know about 

all of it. Most people ?? and I know this doesn’t apply to you. Your 

cases were more severe. Most people resolve it within one day because most of it has to do with credit card fraud and the fraudulent 

use of credit cards. 

So the good news is that for most people it’s fairly easily resolved, and it’s gotten much better and faster to resolve because of 

policies of the FTC and also Congress passed major legislation, for 

example taking credit card numbers off of receipts and other things 

like that. 

Chairman JOHNSON. When you find out somebody in a credit 

card company is doing that kind of thing, do you report it to the 

authorities? 

Dr. VIERAITIS. The company should report it to the authorities. 

Chairman JOHNSON. But are they doing it? 

Dr. VIERAITIS. I don’t know. 


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Chairman JOHNSON. How do they find out? How does the company find out if someone’s—— 

Dr. VIERAITIS. Through law enforcement investigations. 

Chairman JOHNSON. So they can go a long time without finding 

out about it. 

Dr. VIERAITIS. Yes, they could. 

Chairman JOHNSON. Okay. Thank you very much. Ms. 

Kueckelhan, what legislation could we pass to stop ID theft in general, but children’s ID theft in particular? And you know we’re 

looking at trying to stop the hospitals from giving them at birth. 

Would that help you think? 

Ms. KUECKELHAN. Chairman Johnson, may I address the doctor’s comments about the—— 

Chairman JOHNSON. Sure. 

Ms. KUECKELHAN [continuing]. About the theft with the companies. 

Chairman JOHNSON. Please do. 

Ms. KUECKELHAN. The Federal Trade Commission has the red 

flags rule, and the red flags rule is—one of the requirements is 

that a company develop internal standards of data security, in 

other words, minimize access within. And there’s a variety of steps 

that’s recommended that businesses take. So the red flags rule if 

a company, if it applies to them— it doesn’t apply to every type of 

company. Some are exempt. But that would help to set measures 

in place. Again, not 100 percent full proof, but it should help in 

that regard if companies did follow it. 

The Federal Trade Commission has previously recommended 

changes in the National Consumer Authentication Standards. Just 

as you stated, Congressman Johnson, SSN is used across the board 

as an identifier. Following suggestions from our forum, we’ll continue to look at child ID theft issues that we should work with 

Congress on for changes. 

Chairman JOHNSON. Thank you. 

Mr. BRADY. Now, Ms. Kueckelhan, thank you for I understand 

FTC’s very informed forum on the emergent problem of child identity theft, so I appreciate you bringing those experts together and 

those folks. You know, I want to ask you a question and I want 

to ask Dr. Vieraitis and Mr. Feldt follow-up on Chairman Johnson’s 

question about what changes in law does Congress need to make 

to either protect people from identity theft or create more tools to 

apprehend and prosecute. 

But from the FTC standpoint, do you publicly identify companies 

that are more prevalent in allowing their data to be breached or— 

where there are red flags that occur on a regular basis? Do we as 

a public, are we privy to the information about which companies 

do a poor job or are more likely to be—our identity is more likely 

to be breached with doing business with them from a transparency 

standpoint? 

Ms. KUECKELHAN. I don’t know that it’s a transparency issue, 

but unlike an entity like the BBB that has ratings and reports online that would be available to the public; when a consumer files 

a complaint with the Federal Trade Commission, that is confidential as to the public. The public doesn’t have access. 


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But we do open and welcome other law enforcement agencies to 

become—have the right credentials to access our database system 

so that we are the repository for many complaints and ID theft 

being one of those types and accessible to all so that even when the 

criminal authorities working on the individual identity theft side, 

they have access to our database. 

Mr. BRADY. If it’s a government agency whose data is breached 

or government officials who are selling those or providing the information for thieves, who handles those types of cases? 

Ms. KUECKELHAN. I’m not sure I understand your question. 

Mr. BRADY. You pursue on the civil side when companies have 

data breaches that are potentially dangerous for identity theft. So 

who pursues those when it’s government agencies that the data’s 

breached or employees are providing that information. 

Ms. KUECKELHAN. Well, from the consumer’s perspective, the 

misrepresentation takes place when a company represents that 

their security policies have certain qualities that they don’t and 

that misrepresentation gives rise to our authority in the Federal 

Trade Commission Act. 

Mr. BRADY. Dr. Vieraitis and Mr. Feldt, what can Congress do 

to help better protect individuals, and what needs to be done to significantly increase the prosecutions? 

Mr. FELDT. I’d be happy to speak first. Any legislative provisions that would limit the collection, use or disclosure of Social Security numbers would greatly help our efforts. 

Mr. BRADY. But Chairman Johnson’s legislation would be a 

good place to start. 

Mr. FELDT. Exactly it’s a very good place to start; as well as enhanced penalties. As your studies have found, the risk just appears 

to be worth taking for these sophisticated criminals. Some of—— 

Mr. BRADY. Do you know what these punishments range? 

Mr. FELDT. Well, for a first time offense, it potentially could be 

a six month probation or up to a year in prison. But we’re not talking about four, five, six years in prison for many white collar 

crimes. 

Ms. KUECKELHAN. Congressman Brady, on the civil side when 

we have pursued those statutory wrong on the civil law enforcement against companies that misrepresented their set—security 

policies, we have ratcheted up the so-called merchant provisions 

and some of those are up to 20 years. 

Mr. BRADY. On the prosecution criminal side, where there is low 

risk of apprehension and prosecution and you’re saying that the 

penalties aren’t very stiff for—— 

Mr. FELDT. For first offenders. As you spoke about, many are 

first time offenders and without, you know, a major criminal history on the federal side, typically, the penalties are not great 

for—— 

Mr. BRADY. Doctor, what kind of sentences were there for those 

you interviewed, and what were their sentences? 

Dr. VIERAITIS. Those we interviewed ranged from a minimum 

of 12 months to 30 years. 

Mr. BRADY. Were they first time offenders generally? 

Dr. VIERAITIS. Some of them were first time offenders and they 

did receive a significant penalty. They all thought that they would 


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get much less and most perceived the penalty would be probation, 

and they were hit much harder than they thought. So there’s a perception—— 

Mr. BRADY. Because these were federal prosecutions? 

Ms. VIERAITIS. Likely because they were federal prosecutions. 

Local prosecutors sometimes kick them up to the feds because they 

have more resources or it’s a federal crime. It’s crossed states lines. 

There are a lot of issues with jurisdictions. It makes it very difficult for law enforcement to take the report and also do something 

about it. 

But any legislation that will reduce the use of Social Security 

numbers on Medicare cards, Medicaid cards, foster children would 

certainly help; but I would like to say that in terms from the offender’s perspective, the riskiest part for them of that whole crime 

is walking into a bank or walking into a store and cashing in on 

it. 

So getting the number is easy; but the riskiest part for them, the 

one that causes the most stress and the part where policy would 

be good to target, is making it impossible for them to cash in on 

it. And the credit card companies and the businesses have but need 

to do more to protect consumers from that. 

Mr. BRADY. Any chance of that risk go down even more if they 

steal a child’s Social Security number? 

Dr. VIERAITIS. I think the eVerification system and any system 

that can alert the credit card company, the bank, anywhere you’re 

trying to use it that says this number belongs to a person under 

the age of 18, and the person applying for it claims that they’re 40. 

It doesn’t match up. Some sort of system. 

And I believe this was brought up at the FTC conference this 

summer. Some sort of verification to link that number to a child 

so that the offender can’t use it to apply for a home loan because 

no 12-year-old is applying for a mortgage. 

Mr. BRADY. Well, not as many anymore prior to 2008. But we 

fixed that so. Chairman, I went over time. 

Chairman JOHNSON. That’s all right. Thank you, Mr. Brady. 

Mr. MARCHANT. During the last year, we at our congressional 

office has become very proactive in going into senior centers and 

going into libraries and having identity theft seminars. We thought 

that maybe 20 people would show up. Sometimes 20, 30 people 

show up in that kind of seminar. We are having incredible turnouts. And we appreciate the help that we have received from several of the agencies in doing this. We’re having hundred, 120 people show up at these identity theft seminars. So it’s a big issue. 

And the people that are most afraid of it now seem to be the seniors. And I’m beginning to detect that maybe we should have a 

seminar or public meeting with young families and young couples 

and begin to tell them before they have a teenager, what’s happening to you folks has happened. 

So the other thing that I would request from all the agencies is 

a liaison, a specific liaison person that the 535 members of Congress have so that we have this kind of a case coming into our office that we will be able to say, okay, we can call this person at 

these agencies and get a direct liaison and get a very practical 

step-by-step thing that we can do to help that constituent because 


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by the time we get to talk to constituents, many times they are 

very frustrated. A lot of the damage has already been done. And 

we feel very frustrated when they come to us and everything’s happened and the police have said there’s nothing we can do. The District Attorney in many instances has said there’s nothing we can 

do. And by the time they get to us, they’re pretty frustrated. So if 

we can have a direct person that we could contact, it would be very 

helpful. 

And then again I’d like to thank the agencies that have come out 

and help us with our identity theft seminars. They are very popular and for the first time we feel like we’re trying to make people 

aware. 

I would like to ask Mr. Puente, when you go out and you have 

a case in your hands, is there a typical offender that you will find 

when you get out the case in your hand? 

Mr. PUENTE. Yes, sir. And just so you’ll know, my area of responsibility runs all the way down the Rio Grand Valley, so from 

Brownsville all the way up to Laredo and Corpus, the San Antonio 

area. So typically I’m looking for individuals who are undocumented aliens; and when I have an identity theft case in hand, 

that’s the first place I start. 

In most cases, and I’ve been doing this almost 10 years, the 

trends that I’ve seen in Texas that have shifted towards U.S. citizens selling their documents to the document vendors, the parent 

selling their children’s documents. And these undocumented aliens 

are buying these documents in Mexico because it’s cheap. 

Another thing that I have found is some document vendors are 

just making the nine-digit number up. Everybody knows that the 

Social Security number is nine digits. It doesn’t matter what it 

starts with or it ends with; but everybody knows that you have to 

have that nine-digit number to get a job, to get an ID, to get a 

credit card. Everybody knows that. 

And in the case that I worked in Austin, all the defendants that 

we debriefed, they said the same thing: I didn’t care what it looked 

like as long as it had nine digits and I could get a job. And they 

were paying $50 to $100 in a flea market in Austin. So that’s what 

I’m looking for. 

Mr. MARCHANT. Okay, thank you. 

Chairman JOHNSON. So what you’re telling me is this number 

that the IRS gives out, which is nine digits, for people who don’t 

have a Social Security number or ID, it wouldn’t matter to the vendors down there. 

Mr. PUENTE. No, sir. In fact, in this particular case, we had two 

of the defendants that actually had a tax ID number that they 

were using. 

Chairman JOHNSON. As a Social Security number. 

Mr. PUENTE. Yes, sir. They had counterfeited a Social Security 

card with that tax ID number on that Social Security card. 

Chairman JOHNSON. Well, how is that getting through the system? 

Mr. PUENTE. The facility that they were working at did not 

verify any of the Social Security numbers, any of them. So these 

employees were just able to fill out applications. 

Chairman JOHNSON. So using E-verify might work to stop that? 


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Mr. PUENTE. It does work. It absolutely works, yes, sir. 

Chairman JOHNSON. Mr. Brady has one more question. 

Mr. BRADY. Well, one, I wanted to thank you Chairman for 

holding this hearing. This is obviously a problem growing by the 

minute and it’s critical that we’re aware of it. Secondly, these panelists have really given us great insight and I want to thank you 

for that. For the parents in the crowd today and parents learning 

about this problem, can I ask, what is the one or two most important things we can do to protect our families and our children from 

identity theft? 

VOICE. Don’t give out your number. 

Chairman JOHNSON. Don’t everybody speak at once. 

VOICE. When you’re asked to give your Social Security number, 

refuse to give it. 

Mr. BRADY. Can I ask our panelist from your studies and prosecutions and interviews, what can we do as parents? 

Dr. VIERAITIS. I would agree with what he just said. I don’t 

memorize my daughter’s security numbers. I don’t carry their cards 

with me, and I never give the numbers out, ever. There are always 

blanks on forms for it and I just refuse to give it out. And also 

check. I know if you call a credit card company and run the number, it might not pop up. It will pop up ‘file not found’, but that 

doesn’t mean it’s not being used. 

I would imagine the Social Security Administration would be— 

Mr. Feldt—would be the place that you would need to check. If 

you’re concerned about it, check. 

Chairman JOHNSON. Thank you, Mr. Brady. 

Mr. BRADY. Thank you, Chairman. 

Chairman JOHNSON. Again, I want to thank y’all for being 

here, especially Ms. Lanius and Mr. Bryson for sharing your personal experiences. Thank you so much. I also appreciate hearing 

the views of those of you on the front lines fighting identity theft, 

Ms. Kueckelhan and Feldt and Puente. And Dr. Vieraitis your testimony is the first time the Subcommittee has had an opportunity 

to examine the crime of identity theft from the thieves themselves. 

Thank you for your important research. And all of your testimony 

will help us do what’s right to stop the misuse of Social Security 

numbers and prevent identity theft. 

We’re gonna work the problem, and I can tell you that all three 

of us are interested in resolving it and making this great America 

a better place for all of us to live. Thank y’all for being here. The 

committee is adjourned. 

[Whereupon, the subcommittee was adjourned.] 


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Member Submissions For The Record: 


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f 


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Submissions For The Record: 

Axton Betz 


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f 


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ID Theft Info Source 


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James Tielebein 


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Æ 


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