Indentity Theft Scams Reach Levels So Clever That Even You Become An Accomplice

Identify Theft is a frightening fate that the Federal Trade Commission says affects around nine million American every year in various forms. That amount may only be equal to 3% of the U.S. population, but when it hits, it hits hard. Undoing the damage that a criminal can inflict with your credit card in hand can take years, years that could be spent putting a down-payment on a new home or a security deposit on that trendy loft.

The good news is that banks are doing their best to help you out. Brochures are chocked full of details of how to avoid identity theft, while the likelihood of card companies being generous and reimbursing you for fraudulent transactions. The bad news? Thieves are, evidently, getting smarter and they're devising schemes that are simply cringe worthy.

Take Guardian reporter Andy Welch for example. He was the unfortunate victim of what is likely to be one of the most elaborate schemes you'll ever hear of. What started off as simple bit of due diligence on a hungover Sunday morning, ended up being a nightmare that began with a simple call from his bank.

Everything about the call seemed legit, enough. Welch was told by "Visa Card Services" that there were a number of fraudulent purchases made with his bank card amounting to over $1600. The Card Services caller then confirmed the location of Welch's last transaction and provided Welch with a reference number to use when he made his next call. That next call, Welch was instructed, was to be made to the number on the back of his bank card.

Then came the following:

"The person apparently helping me, Rajesh Khan in HSBC's card protection department, had all my details: full name, date of birth and, crucially, my address. When he said a courier was on the way to collect my bank card for further examination, I didn't need to tell him where I lived."

Welch admits that many aspects of the fraud reporting process were foreign to him and felt a little strange but, at the time, he put that down to his being new to the process as a whole, rather than suspecting that something was fishy. And because he was in a desperate mood to resolve the situation as quickly as possible, he complied.

"I packaged the card up as requested and waited for the courier to arrive," Welch said while reliving the frightening events. "Rajesh called back twice, once to say the car was five minutes away, and again to say it was outside, quoting the car's number plate and describing the driver. He called again later that afternoon to say they had received the card and that I would have my money back in a few days. Sucked in by the efficiency, I went through exactly the same process the following day with my credit card. The same fraudsters had somehow hacked into my online account and maxed it out."

By then Rajesh had Welch's trust. He had facilitated a quick and easy process for Welch to recoup his savings. In Welch's mind, there was no harm nor foul. Perception was reality for him, until he made a call to his bank, this time from his cell phone, at which point he was in a for the shock of his life.

"But Mr Welch, your cards haven't been reported stolen."

Though he'd been called by Visa themselves, though he'd called the number on the back of his debit card himself and though the card company's employees had provided him with information that was typical of every phone call to a major bank, Andy Welch had somehow fallen prey to an identity theft scam, seemingly and incredibly while trying to report just that. But how?

Well, unraveling how Welch became a victim of such a scheme is a matter of peeling off the layers. First and foremost, it must be stated. No, Welch was not called by Visa Card Services, rather a man that said he was calling from Visa Card Services, seemingly equipped with a knowledge and cadence of one who would be working at Visa. But it still doesn't explain how that knowledge was attained.

"It all started, according to the police, on the Saturday night where one of this gang will have watched me take money from the cash point," Welch said.

The "gang" then followed Welch home, which explains how they knew his address. The rest of the plot, though, is where the real ingenuity of criminals manifested itself.

"As for the call: well, credit where it's due, it's pretty clever. If you call a landline it's up to you to end the call. If the other person, the person who receives the call, puts down the receiver, it doesn't hang up, meaning that when I attempted to hang up to go and find my bank card, the fraudster was still on the other end, waiting for me to pick up the phone and call "the bank." As I did this, he played a dial tone down the line, and then a ring tone, making me think it was a normal call."

It's natural to accuse of Welch of stupidity and, not to mention, easy. Even he questioned himself.

But the unfortunate circumstances he found himself sheds a light on a number of different issues we could all find ourselves in. If a criminal is intent on stealing your information, it could be you they're watching at that ATM. Perhaps they won't be as successful, but nonetheless there. And how about all those calls you make to your bank, lenders, your school? How easily do you give away your social security number to someone who "has" to be trusted and responsible with it.

The idea of adding a touch of paranoia to your financial endeavors may be a little tiring to think about, never mind do. Who really wants to be cautious and ask a bunch of questions that might not be necessary? One thing is for certain, though, a false sense of security and the idea of that you have to be a "dummy" to have identity stolen is likely to be the mindset set criminals want you to have.

"The feeling of total financial ruin, of utter helplessness, isn't one I will forget in a hurry. Setting up all new direct debits was an unholy pain and, four months on, problems are still arising and my credit rating has taken a serious knock."

The lesson, now, seems simple. Always be on your toes when it comes to your name and credit. "Why in the name of all things holy hadn't I checked my balance to see for myself what the damage was before I even called the bank that Sunday morning?"