Workplace Facts and Statistics

Identity theft affects both the consumer and the business community in a multitude of ways.  The impact of this crime clearly touches business at all levels and from many directions. Included below are some of the statistics that demonstrate areas of concern for members of the business community.

Cost to Business:

• Studies on the total cost of identity theft vary. One study said that identity theft cost U.S. businesses and consumers $56.6 billion in 2005.ⁱ
• According to one expert, the loss or theft of just one laptop can cost a company as much as $90,000 or more in fines, credit monitoring for victims, public relations damage control, and class action litigation.ⁱⁱ

• According to the U.S.  Department of Justice Statistics, identity theft is now passing up drug trafficking as the number one crime in the nation.  ⁱⁱⁱ A preliminary study done by ITRC shows that the majority of id theft criminals are repeat offenders.  Other convictions include substance abuse, narcotic trafficking, violent crime, robbery, and immigration issues.
• According to the Aite Group LLC, in a March survey 21 of the top 100 U.S. retail financial institutions reported that 39% of responders indicated an increase in online banking and bill-payment losses over the past year.
• A Zogby study reports that 91% of Americans are now concerned about identity theft and expressed concern that legitimate retailers would sell their information without consent. 83% are specifically worried that information will wind up in the hands of a third party.
• In that same study 34% of respondents did not think retailers are doing a good job of protecting their personal data, compared to 28% who felt companies protect data adequately.
• A Unisys survey reported by Internet Retailer said that 16% of respondents have stopped shopping online because the process requires a bank card, citing fear of card fraud and theft.

Cost in tax dollars:

• A GAO study on identity theft (GAO-02-363, issued March 2002) discussed costs to federal agencies – The executive office for U.S. Attorneys estimated cost of prosecuting a white-collar crime case was $11,443.  The Secret Service estimates the average cost per financial crime investigation is $15,000.  The FBI estimates the average cost per financial crime investigation is $20,000.

Breach losses:

• The Unisys’ study also reported that 69% of those survey said they would stop using a site that lost their personal information.
• Forrester Research Firm did a study entitled “Calculating the cost of a security breach.” ^iv In this study the following data was reported:
• Of 83 corporate IT managers, 28 acknowledged having to cope with a data breach
• The costs of a data breach vary widely ranging $90 to $305 per customer record, depending on whether the breach is “low-profile” or “high-profile” and the company is in a non-regulated or highly regulated area, such as banking.
• In counting up costs, Forrester estimated the cost at $50 for the discovery, notification and response that brings in unexpected expenses associated with legal counsel, call centers and mail notification.  It also noted a lost employee productivity that would range from $20 to $30 per customer record.

It is proven that the negative effects of identity theft or a breach of information to a business can have long term and far reaching ramifications.  It should be a priority for business owners and executives to heighten their awareness of identity theft, and the financial and image costs of a data loss.  It is apparent that the misuse or loss of information is a concern for over 80 percent of the consumer base.  The focus of the consumer is both on their own security as well as the actions and activities of the businesses that they use.  How does your business measure up?  The Identity Theft Resource Center has provided consultation services to both business and government agencies on the prevention of identity theft and data loss.

ⁱ Network Computing, Don MacVittie, Aug.  31, 2007.  Javelin 2006 Identity Fraud Report
ⁱⁱ Robert Siciliano at IDTheftSecurity.com, 24/7 Press Release October 10, 2006
ⁱⁱⁱ www.Baylor.edu; March 29, 2006, Jonathan Lopez
^iv http://www.forrester.com/Research/Document/Excerpt/0,7211,42082,00.html