Identity Theft A Growing Concern For Businesses It's not just people who have to worry about identity theft. Businesses are also vulnerable, and there are a lot of schemers out there, some of them quite clever.
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Identity Theft A Growing Concern For Businesses

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Identity Theft A Growing Concern For Businesses

Identity Theft A Growing Concern For Businesses

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It's MORNING EDITION, from NPR News. Good morning. I'm David Greene.


And I'm Renee Montagne. A lot of people worry about identity theft, and now businesses are also at risk. Business identity theft involves posing as a legitimate business to get access to credit lines or steal customers. As NPR's Yuki Noguchi reports, experts believe that in the past two years, there's a lot more of it.

YUKI NOGUCHI, BYLINE: Scott Burnett is general manager of AAA Termite & Pest Control in Memphis. His family has owned and operated it for four decades. Last year, the Yellow Pages landed on Burnett's doorstep, listing three other AAA Pest Controls. None of the me-too listings were affiliated with Burnett's business.

SCOTT BURNETT: You would have no way of knowing you're not dealing with us. And I would have no way of knowing that you've called.

NOGUCHI: It wasn't just AAA. A hundred and three phony pest control businesses popped up in last year's phone book - in print and online - appearing to double the size of the industry overnight.

BURNETT: All of the locations that were advertised came out to be vacant lots or gas stations. So they gave a physical address, and they gave a local 901 phone number, but you would have no idea that you're not dealing with the original AAA Termite.

NOGUCHI: Burnett panicked. He imagined imposters gaining entry into people's homes, spreading poison, or worse.

BURNETT: Every day we're all wondering: Is this the day that somebody's going to go out and do something wrong under my name?

NOGUCHI: The look-alike AAAs hung up when he called asking for a manager. Burnett hired a lawyer. But the phone company refused to divulge who listed the phony businesses. He called state investigators and the national pest control association, but no one knew what to do. No one had heard of business identity theft. The only people who had were the local locksmiths. They had faced a similar problem.

HUGH THOMPSON: Business identity theft is incredibly underreported.

NOGUCHI: That's Hugh Thompson, who teaches at Columbia University and chairs an annual conference on security. No federal or state statistics track the problem. And Thompson says few victims are willing to report it.

THOMPSON: There's a big stigma attached with it. Imagine you're a company trying to portray an image of being solid and reliable out to your customers. It's not something that you want to readily admit to.

NOGUCHI: Business identity theft takes many forms. Posing as a look-alike or sound-alike business to lure customers is one of them. But in many cases, shady operators go after information to tap into businesses' credit and reputation. They change a business' contact information, for example, then use it to obtain credit cards or order goods, skipping town before bills arrive. Thompson and others say the sophistication of these schemes suggest crime syndicates may be involved. But Thompson says whoever is doing it is taking advantage of the fact that so much more business is done online these days.

THOMPSON: I think it's a big problem and a growing one, because of how extended companies and governments now are online. And whenever you're dealing with transactions at a distance, the big question is: How do you prove who you are to that entity?

NOGUCHI: Local governments, for example, are relying more on e-government because of budgetary constraints. Elaine Marshall is North Carolina's Secretary of State. She sees an increasing number of cases involving falsified documents. Marshall chairs a new task force on business identity theft for the National Association of Secretaries of State.

ELAINE MARSHALL: The easiest target are dissolved corporations.

NOGUCHI: Because whoever ran those defunct businesses usually no longer pays attention.

MARSHALL: Somebody comes up 20 years later and reinstates it. Well, it looks like it's a 40-year-old corporation. And if it was in good standing financially when it was dissolved, then somebody's trying to capitalize on that good standing.

NOGUCHI: As for Burnett of AAA Pest Control, he's not sure how much the fake AAA operators managed to capitalize on his good standing.

Did you ever find out who it was?

BURNETT: No, ma'am. Privacy laws protected them. Can you believe that?

NOGUCHI: Last week, the new Yellow Pages arrived, this time with no imposters. But Burnett says it may just be a matter of time before they pop up again. Yuki Noguchi, NPR News, Washington.

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