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Identity and Financial Identity Theft

Identity and Financial identity theft

Cybercrime is defined as any criminal activity that involves or is carried out through the use of a computer, a computer system, or a schmoozed device, according to the National Institute of Justice. The vast common, but not all, of cybercrime is done by cybercriminals or hackers who are inspired only by monetary gain. Cybercrime can be dedicated by persons or administrations. Some cybercriminals are well-organized, use cutting-edge techniques, and have a strong understanding of computer technology. Others are newcomers to the hacking world. In most cases, cybercrime is performed to cause harm to computers for reasons other than financial gain, which is unusual. These could be of a political or personal nature, depending on the situation.

There are many different kinds of cybercrimes. Email and internet scam, identity scam, theft of monetary or card imbursement data, theft on sale of business information, cyber coercion, Trojan ware attacks, crypto-jacking, and cyberespionage are all examples of cybercrimes. (Pinthong, et al. 2020) The form of cybercrime that I have chosen for this assignment is monetary identity theft and financial identity theft, which is a type of monetary fraud. When an undesired third party compromises your existing bank account(s) or opens new financial accounts in your name, this is referred to as financial identity theft. Accounts include inspection or savings financial records, credit or debit cards, loans, medical billing accounts, cover, and a variety of other financial instruments. Debt collection and bankruptcy troubles are two ways in which financial identity theft can have an impact on its victims’ lives.

Various methods of financial identity theft exist, but the most prevalent is illegal admission to your monetary card(s) or account facts through theft, hacking your online account, or a data break connecting your account evidence. Financial identity theft can involve the theft of a variety of different sorts of information and documents. Account numbers, credit or debit card numbers, a user’s name as well as contact information (address, phone number, email address) are all sorts of personal information that can be gathered and saved. In some cases, Social Security numbers are also collected and stored.

The evolution of identity and financial identity theft

The concept originated with criminals who wanted to avoid capture a long time ago. They would frequently murder unwitting victims to steal their identities. This was done for them to be able to continue living their lives without fear of being imprisoned for their crime. What was it about this that made it so simple? This was decades before the widespread use of identifying documents such as photo IDs and social security numbers became commonplace. A person’s identification was determined by their words as much as their signature throughout this historical period, according to historians. (Bose, et al.2019) When phones became a common place home item, identity thieves took advantage of the situation. They would phone and say that a person had won money, after which they would ask for their details to release the money to them. Identity theft ploys like this are still in use today and account for a significant portion of all identity theft schemes.

Criminals moved on from phones to another vulnerable point: the trash of ordinary people. Not everyone was disposing of their information in the most appropriate manner. As a result, they became vulnerable to dumpster divers. These individuals would rummage through trash in search of documents containing sensitive information. They would next make use of the knowledge they had discovered to their advantage. As people become more cautious while dealing with important data, the internet grew to become a more integral part of everyone’s day-to-day existence. These identity crimes have evolved swiftly to stay up with the times, resulting in a significant surge in identity theft since the arrival of the internet in the 1990s. It became easier and less conspicuous to obtain this information from others as a result of this change. Because there were no geographical restrictions, they were able to reach a bigger audience. A wide variety of unlawful methods, including viruses, malware, and hacking, are frequently employed.

The period when identity and financial identity gained national attention

Financial fraud can be traced to the time of 300 B.C. when a Greek businessman named Hegestratos took out a massive insurance strategy known as bottomry to protect himself from financial ruin. Upon delivery of the load in this example, corn the commercial pledged to pay back the money he had borrowed, plus interest, to the lender. (Wu, 2018) If the merchant fails to repay the loan, the lender may be able to seize the load as well as the boat that was used for its conveyance. Hegestratos had a plan to sink his empty boat, retain the loan, and sell the maize he had harvested. When the plot failed, he drowned while attempting to flee from his team and travelers, who had wedged him in the performance of escaping.

The United States of America experienced its first scam in the year 1792, only a little year after the country gained its nominal independence. At the time, American bonds were analogous to the way that increasing world matters or junk bonds are today: their value varied with every piece of news about the treasures of the colonies that distributed them, and they were illiquid. Being one step ahead of the news that would cause a bond’s value to rise or fall was the key to investing in such a turbulent market, according to experts. Alexander Hamilton, Secretary of the Treasury, started the process of reorganizing American finance by substituting unsettled debts from individual colonies with bonds issued by the newly established central administration.

As a result, large bond stakeholders wanted out individuals who had connections to the Treasury to learn which bond offerings Hamilton would be replacing. Mr. William Duer, an associate of President George Washington’s close circle and associate secretary of the Treasury, was in a prime place to profit from insider statistics about the president. (Wu, 2018) All of the Treasury’s actions were known to Duer, who informed his associates and traded in his collection before permeable specific statistics to the public that he knew would increase the value of the Treasury’s stock. Then Duer would just vend the property for a quick income. After years of this kind of deception, which included plundering Treasury cash to place greater bets, Duer was forced to resign, but he retained his insider connections. He sustained to put his own money, as well as the money of other stakeholders, into debt matters, as well as the shares of new banks that were springing up all across the nation.

Nevertheless, as a result of all of the European and local money pouring into bonds, there was a hypothetical oversupply as issuers scrambled to cash in on the opportunity. To stay ahead of the competition in a hot market, Duer relied on his knowledge advantage to stay one step ahead of the competition. He threw his ill-gotten earnings, as well as the money of his stakeholders, into the stock marketplace. Duer also took out a lot of loans to help him leverage his bond bets even more. It all came out in the end and it all came crashing down and Duer and a large number of other New Yorkers were left holding onto worthless investments and crippling debt. Hamilton was forced to intervene in the market by purchasing bonds and serving as a moneylender of last resort. William Duer was sentenced to borrower’s prison, where he died in 1799 as a result of his actions. Although it may seem strange to say so, the Financial Panic of 1792 served as a stimulus for the Buttonwood Contract, which marked the openings of Wall Street’s investment public and the New York Stock Exchange.

How technology has influenced the evolution of identity and financial identity theft

Maintaining a high level of technical proficiency is a necessity for today’s society. It’s a daily challenge for them to keep up with the rapid pace of change in both their personal and professional lives and the industries in which they operate. With today’s technology, it is possible to conduct business with a friend down the street or across the globe via videoconference.

Using a computer and an Internet connection, people can now do everything from the maximum ordinary tasks like arrangement groceries from the grocery store to the most difficult ones like performing a complex surgery. (Zou, et al 2020) As the Internet has expanded since its humble beginnings back in the 1990s, it has become a global electronic network that will only continue to expand. Internet users rely on it as a reliable source of information because they use it every day.

It is impossible to stop the constant flow of personal information such as Social Security, credit card, and password numbers over wires and the air. Most people feel safe and secure on the Internet because of the security processes in place to defend this kind of statistics. Criminals, on the other hand, have adapted to technological advancements and, as a result, more people are falling victim to crimes committed online.

To steal another person’s identity, criminals have for years been stealing personal information from rejected credit card receipts, bank reports, tax notices, and other bills (often found in the trash) to gain access to their personal statistics. However, in today’s electronic environment, these criminals have taken advantage of technological advances to plan deceitful new approaches of theft, which are known as cybercrimes. Presently, computer hacking and email scams are known as phishing are among the risks associated with sharing statistics on the internet.

The ability to enter zones of the Internet where they are not permitted and hack into extra computer system is what computer hackers are known for. Upon entering a computer’s system, they can vision forms, files, and personal information that can be used for their gain, such as identity theft. Phishing, on the other hand, is a technique in which individuals are deceived into giving their individual data to a thief who is impersonating a genuine trade or government activity. Throughout recent years, both of these types of cybercrimes have seen an increase in frequency and severity. The Wall Street Paper reports that there were extra than 9.9 million circumstances of character theft reported across the country in the past calendar year.

Legislation related to identity and financial identity theft

Several laws have been put in place to deal with the cybercrime of monetary identity theft. These laws include; the character theft and supposition deterrence act. Since the rise of identity theft and the negative consequences it has on those who are targets of identity theft, the United States Congress has passed legislation making it a federal crime. (Zaiss, et al. 2019) It is a federal crime, according to the Character Theft and Assumption Deterrence Deed, when a person significantly transmissions or uses, without legal ability, a means of identification of another individual with the determined to commit, or to aid or assist, any illegal action that establishes a defilement of Federal law, or that establishes a crime under any appropriate State or local rule.

Secondly is the theft consequence enhancement deed of 2004, A year later, in 2004, the Theft Penalty Improvement Deed was passed, imposing harsher penalties for “worse” identity theft, including extra sentences of two years in overall and five years in terrorism-related crimes. And lastly, is the identity theft implementation and compensation deed, in 2008, Congress passed the Identity Theft Enforcement and Restitution Act, which broadened the scope of criminal prosecution and increased the amounts of restitution obtainable to victims of identity theft and scam.

Limitations related to the legislation of identity and financial identity theft

Legislative energies to enact federal character theft legislation must strike a balance between the opposing needs of targets, administration agencies, and trades while remaining elastic enough to forestall future character theft problems. The wrongdoings that are now deliberated identity theft were previously prosecuted under “false personation” decrees, which date back to the late nineteenth period and were referred to as spoofing. False personation is well-defined as the corruption of falsely presumptuous the character of another to obtain an advantage or evade incurring a financial obligation. (Jin, 2019) Other limitations to the legislation of monetary identity theft include; the fair collection practices act, reasonable credit reporting act, driver’s confidentiality defense act, and health information transportability and responsibility deed of 1996.

Penalties in the USA for the crime of identity and monetary identity theft

Identity theft rules differ from state to state, as do all criminal laws, and there are also central rules that have their consequences for those who commit identity theft. Having your identity stolen and being convicted can result in one or more of the following punishments:

  • Incarceration. If you are convicted of an identity theft crime, you may be sentenced to jail or prison time. In overall, a misdemeanor belief can consequence in up to a year in jail, whereas a felony opinion can consequence in several years or supplementary in prison, depending on the circumstances. In a similar vein to theft wrongdoings, the potential sentence for character theft frequently upsurges in proportion to the quantity of money stolen.
  • Fines. When someone is convicted of identity theft, it is common for the court to order them to pay a fine. Fines for misdemeanor offenses can sometimes exceed $1,000, while felony penalties can easily reach or surpass $5,000. (Piquero, 2018)
  • Restitution. The defendant will typically be ordered to pay restitution to the casualty of identity theft causes them to lose money or suffer financial harm as a result of the theft. In contrast to fines, compensation is intended to recompense the casualty for his or her losses, whereas penalties are intended to punish the committer. Since it can take a significant amount of time and effort for an identity theft victim to recuperate from character theft, some states need perpetrators to pay a least amount in compensation even if the casualty agonized no direct monetary loss.
  • Probation. For first-time criminals who commit identity theft wrongdoings that do not cause important damage, it is potential that a court will sentence them to probation in adding to, or instead of, other consequences. Probation sentences are usually for at minimum a year, but sentences of three or more years are also mutual in some cases. People on experimentation must adhere to precise court-imposed requirements, such as reporting to a probation officer regularly, paying all compensation and fines, and refraining from obligating any additional wrongdoings.

The degree of these penalties and how they are adequate for penalizing the offenders

These penalties are good in penalizing the offenders. When people are incarcerated, these make people fear committing financial identity crimes and other crimes that are related to identity theft. This is because, people fear spending their whole life in prison, hence resulting in reducing the crimes of character theft. On the other hand, fines are a major penalty in penalizing the offenders, when the offenders are being penalized, they fear committing the crime again and hence reducing it.

Problems law implementation might face in energies to stop identity and financial identity theft

Law execution might face the following challenges in their energies to stop financial identity theft. These challenges include; public awareness, many people are not aware of how easily their information can be stolen to make it easier for fraudsters to gain access to individual finance, such as ATMs cards. (Holt, 2018) This has been a major challenge for law enforcement in their efforts to prevent financial identity theft. The second challenge is partnership and collaboration, there should be a good partnership between government institutions such as police and the financial institutions in reporting these cases of financial identity theft. Sometimes, when there is no partnership, the fraudsters may walk out freely without being prosecuted. And finally, is the challenge of legislation, there should be the enactment of laws that can be used to cover these crimes, currently, there are few laws that cover this crime hence making it difficult to prevent.

How law enforcement might make use of technological solutions to prevent and address identity and financial identity theft

Law application might use technological solutions to stop and address identity and financial character theft and cybercrimes through the following three strategies. Firstly, law enforcement should create a cyber-defense plan, Agencies should begin by determining which areas are in greatest need of assistance. Currency theft, account hijacking, data theft, and cyber terrorism are all examples of criminal activity that is on the rise, according to recent statistics. Setting priorities and determining what is most important can assist agencies in developing a plan and determining what tools they will require to address their concerns. (Soomro, et al. 2019) Additionally, leverage intelligence tools to shine a light on the darknet, While the darknet has long served as a haven for criminals, the problem became even worse during the COVID-19 pandemic in 2015. As more systems and people began to rely on online services, the amount of data that was exposed increased exponentially. As a result, the number of hackers engaged in cryptocurrency scams increased dramatically; according to a report published in the spring of 2020, criminals made $1.4 billion from cryptocurrency crimes in the first few months of the year.

And lastly, they should recruit artificial intelligence for better insights and faster resolutions, many law enforcement agencies have been ahead of the curve when it comes to artificial intelligence. A police department that does not already use some form of facial recognition or image-enhancement technology is difficult to come by. That’s encouraging because it indicates that agencies have already made significant investments in many of the tools necessary to combat cybercrime. There may be little need for additional large-scale investments.

How law application might use technology to advantage humanity and effect communal change

Law application can utilize technology to profit humanity and consequence social change by; law enforcement can use technology to teach the public to be conscious of cybercrimes. This can be through the use of online platforms such as digital media in informing society to be aware of how these cyber crimes are committed. (Hardyns, et al. 2018) Most importantly, the public will be informed of several ways in which to avoid being involved in these cybercrimes. Additionally, law application might use technology to advantage society and effect communal change by recruiting artificial intelligence for better insights and faster resolutions. Artificial intelligence is important because it makes law enforcement officers be able to carry out their operations while mitigating these cybercrimes.


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Bose, I., & Leung, A. C. M. (2019). Adoption of identity theft countermeasures and their short-and long-term impact on firm value. MIS Quarterly43(1).

Wu, T. (2018). The curse of bigness. Antitrust in the new gilded age. Columbia Global Reports.

Zou, Y., Roundy, K., Tamersoy, A., Shintre, S., Roturier, J., & Schaub, F. (2020, April). Examining the adoption and abandonment of security, privacy, and identity theft protection practices. In Proceedings of the 2020 CHI Conference on Human Factors in Computing Systems (pp. 1-15).

Zaiss, J., Nokhbeh Zaeem, R., & Barber, K. S. (2019). Identity threat assessment and prediction. Journal of Consumer Affairs53(1), 58-70.

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Piquero, N. L. (2018). White-collar crime is a crime: Victims hurt just the same. Criminology & Pub. Pol’y17, 595.

Holt, T. J. (2018). Regulating cybercrime through law enforcement and industry mechanisms. The ANNALS of the American Academy of Political and Social Science679(1), 140-157.

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Hardyns, W., & Rummens, A. (2018). Predictive policing as a new tool for law enforcement? Recent developments and challenges. European journal on criminal policy and research24(3), 201-218.


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