CastleCops® - Troops Risk Identity Theft After Burglary

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WASHINGTON, Jan. 11 — ADAM CLYMER reports; Thousands of military personnel facing deployment for a possible war with Iraq are also confronting a threat on the home front — the risk of identity theft after burglars stole computerized records from a health care company in Phoenix last month.

The names, addresses, telephone numbers, birth dates and Social Security numbers of about 562,000 troops, dependents and retirees were on laptops and computer hard drives stolen from a nondescript building in an industrial park on Dec. 14, company officials said. Some medical claim records for people on active duty were also stolen from the company, TriWest Healthcare Alliance.

Even without the medical records, the information stolen is enough for criminals to use in creating false identities. TriWest, a Pentagon contractor handling medical claims for military personnel and dependents, warned the 562,000 customers in 16 Mountain and Western states that their identities might be stolen. It also posted a $100,000 reward.

TriWest advised the potential victims, of whom 183,000 are on active duty, to ask for free credit reports and flag their credit records. Within about 10 days, said David J. McIntyre Jr., the company's president, customers will only have to notify TriWest that they want this done, and TriWest will take care of the details.

Thus far, TriWest and the federal authorities say, none of those whose records were stolen have had their identities stolen. But Betsy Broder, an identity theft expert at the Federal Trade Commission, warned that it often takes weeks or months for such thefts to become apparent.

Paul K. Charlton, the United States attorney for Arizona, praised TriWest for coming forward promptly rather than trying to hide an embarrassment.

Mr. Charlton said in an interview on Friday that law enforcement authorities had agreed that it was more important to draw attention to the risk so potential victims could protect themselves than to follow what might have been a more typical police strategy, like conducting a quiet undercover investigation, offering to buy the materials from the perpetrators to catch them.

You weigh that against the risk of identity theft, he said, and the balance of the scales clearly comes down in favor of protecting the half a million people who are serving our country. He added, The theft of half a million identities certainly makes this the biggest case we've ever dealt with.

Mr. McIntyre said that the theft included several laptops, and pieces of computer hardware that people were able to take out of our building. He said the cost of replacement was $25,000, max, and if sold as used equipment, the stolen goods would not bring in more than $2,000.

It's unlikely that people were breaking in for resale value, he said. They left things that were more valuable and easier to hock.

The Federal Bureau of Investigation and the local police are involved in the investigation, as is the Defense Criminal Investigative Service at the Pentagon. Mr. Charlton's office is taking the lead role.

At the Pentagon, Maj. Sandra Troeber said, Our contractors have not experienced a break-in and theft such as this previously. Major Troeber said all contractors and military medical facilities had been told to assess their security, and she expected new directives to result in higher levels of information security.

As for TriWest, she said that while the investigation was proceeding it would be premature for us to comment on whether the company's security procedures had met Defense Department requirements. But since the break-in, she said, TriWest has taken additional measures to enhance their security.

Mr. McIntyre would not describe those steps, but said, We're obviously taking substantial security measures.

He also said that 23 of the stolen records included credit card numbers, which would make it easier to steal identities quickly, and that he had personally spoken to each of those cardholders.

At the Federal Trade Commission, where she is an assistant director in the Bureau of Consumer Protection, Ms. Broder said TriWest had displayed a very victim-sensitive approach.

Another authority on identity theft, Beth Givens of the Privacy Rights Clearinghouse in San Diego, said TriWest had done well but could have done more. Ms. Givens said any company that was negligent in its handling of personal information that could lead to identity theft should provide the victims with credit-monitoring services. These may cost an individual $120 a year, she said, but a company like TriWest could undoubtedly get a quantity discount.
Copyright 2003 The New York Times Company

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