Identity Theft: Identity Theft Using US Commerce Law

Identity Theft Using US Commerce Law - The Wo Hop To Case

By Security Editor

In one of the most remarkable cases of gang identity theft and fraud activities in recent years, the Wo Hop To case stands out ...

Identity theft and fraud was already a multibillion-dollar criminal industry back in the 1990s. Although the NUMBER of identity fraud cases in on the decline, the TOTAL COST to America is on an up trend. In the last couple of years, total figures jumped by $2 billion additional dollars lost to identity theft.

One of the reasons for this identity theft up trend is that the American consumer market sits like a big, vulnerable target on the face of the globe. Robust American consumerism contributes to this vulnerability. So does an increasingly plastic economy.

The problem becomes worse when you consider that not only have industries and technologies all over the world gone global, so has crime.

Identity Theft Using US Commerce & Law

In one of the most remarkable cases of gang identity theft and fraud activities in recent years, the Wo Hop To case stands out. Not only did the Asian gang use legitimate American cardholders, it also used federal laws to keep the racket going!

The gang had already set up a veritable counterfeit credit card factory in the US, importing everything from machines to magnetic strips from Hong Kong. Even a sort of identity theft quality-control process was set up: a gang member would try out the fake cards at restaurants, gas stations, and stores.

And then they got creative.

Identity Theft - Creating a “Win-Win” Situation

The gang started recruiting genuine credit cardholders, asking them to OVERPAY their monthly bills with counterfeit bank checks. Once the recruit's account was credited, the recruit and a gang member would go on a shopping spree.

The gang would then fence the goods and the recruit would get some of the proceeds. Eventually, the gang would use federal bankruptcy laws to have the recruit avoid any liability by filing for credit protection!

It succeeded because it was so easy to get recruits. The recruits felt protected by federal laws AND it was so lucrative!

One recruit pocketed a total of $615,000 inside 12 months!

After the dust settled, everyone who participated in this massive scam had cost MasterCard and Visa over $100 million, affecting over a hundred financial institutions.

To this day, credit card fraud is the leading culprit in identity theft cases throughout America, judging by the complaints received by the FTC.

When the notorious Asian gang case happened in the mid-1990s, experts predicted that credit cards would cease to exist in the next few years and that all transactions (i.e., credit, debit, ATM, etc.) would be unified into one plastic card. Moreover, even filing for a loan would remove humans from the equation, using purely plastic and machine (as in an ATM machine).

They were dead wrong.

Identity theft has put America on the defensive and the scenarios experts predicted appear to be still a decade or two away.

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