What You Need to Know About Aggravated Identity Theft
Federal charges for aggravated identity theft involve the misuse or unauthorized use of another person’s identifying information or documentation. Aggravated identity theft is most often committed for financial gain, such as a phishing scheme or misuse of a credit card, but it could also be perpetrated in furtherance of another crime or to obscure someone’s identity.
In certain instances, the intended use of identifying information or documents matters to the prosecution of the crime, but most charges for identity theft only require knowledge that the documents were false, fraudulent, or stolen.
What Is Considered Identifying Information or Documentation?
You may associate aggravated identity theft with the appropriation of another person’s entire identity. For example, the misuse of a person’s passport in furtherance of criminal activity. However, identity theft can be the misuse or fraudulent use of a single piece of identifying information or personal data. Theft of a credit card number is also identity theft.
Today, there are hundreds of different types of personal data and identifying information or documentation that could be used in criminal acts of identity theft. Some of them include:
- First and last name
- Social Security number and driver’s license
- Place and date of birth
- Biometric records
- Email and account passwords
- Credit card number and bank account information
- Genetic information
- Login name, handle, and online usernames, and
- Digital identity.
Examples of Aggravated Identity Theft
Aggravated identity theft is not a new crime. Acts of impersonation or fraudulent documentation have existed throughout U.S. history, but many of today’s forms of aggravated identity theft use sophisticated technology and computer networks. What are some common examples of aggravated identity theft?
- Compromised credit card, debit card, or bank account information used for unauthorized purchases in stores or online.
- Fraudulent use of Social Security Numbers and personal identification numbers, such as driver’s licenses.
- Use of email phishing scams to obtain personal data and identifying information, in order to recreate identifying documents or complete online transactions.
- Trafficking of false or fraudulent documents by an entity in furtherance of a criminal enterprise.
- Hacking email accounts and other online memberships to mine personal information, including names, birthdates, Social Security numbers, and other personal data.
Just as there is an increasing number of ways to commit identity theft, there is also a rising number of false accusations of federal identity theft.
The Federal Law on Identity Theft
There are two federal statutes that criminalize identity theft and fraud under federal law. One statute is applicable to the less serious offense, simply called identity theft, while a subsequent statute covers more grave instances of identity theft, called aggravated identity theft.
The Identity Theft and Assumption Deterrence Act
The first statute was passed as part of the Identity Theft and Assumption Deterrence Act in 1998. At the time, this was the only federal statute to explicitly and directly criminalize the theft or misuse of another person’s identity. Since, its inception, the criminal provision of the Identity Theft and Assumption Deterrence Act, found at Section 1028 of the U.S. Code, has been frequently used to prosecute less substantial schemes and scams involving theft and fraud of personal information or data.
Section 1028 broadly criminalizes any act of possessing, transferring, trafficking, or creating fraudulent documents. It casts a wide net that extends from online identity theft for purchases to the creation of fraudulent passports. It also ensnares unknowing and innocent people by its wide breadth and use by federal prosecutors.
Elements of Criminal Identity Theft
Identity theft is any misuse of another person’s personal or identifying information. This includes creation, possession, sale, or unauthorized use of another person’s information. Under U.S. Code § 1028, these varying acts of identity theft are better defined. Identity theft can be when an individual knowingly does any of the following.
- Produces a false document or produces an identification document without the lawful authority to do so.
- Transfers any identification document knowing that it was false, stolen, or intended for another type of misuse by the recipient.
- Possesses five or more identification documents with the intent to use those documents unlawfully or transfer them unlawfully or possesses five or more false documents.
- Possess an identification document unlawfully or possesses a false document with the intent to use such a document to defraud the United States government.
- Produces uses or possesses the equipment or feature required to make false documents with the intent to use that equipment to produce false identifying documents.
- Possess a document that has features, emblems, or authentication feature of the United States when the defendant knows such a document is false or stolen.
- Transfers, possesses, or uses the identifying documentation of another person with the intent to commit, aid, or carry out an unlawful activity that is a federal crime or felony under state law.
- Trafficks false documents or the equipment specifically used to make false documents.
Aggravated Identity Theft as Federal Law
It wasn’t until 2004 that there was a federal statute to cover more substantial charges for aggravated identity theft, but once passed, most of the federal charges for identity theft fell under this more server statute. Today, it is a rare occurrence that identity theft is prosecuted under Section 1028; rather Section 1028A is used.
Section 1028A of the U.S. Code defines aggravated identity theft as:
- During and in relation to any felony violation, a felony violation is defined in the federal statute;
- An individual knowingly transfers, possesses, or uses;
- A means of identification of another person, without lawful authority.
The noticeable difference between the definition under this more serious statute is the requirement that the identity theft is committed during a felony violation. The statute directly defines this legal term. A felony violation includes:
- Theft of public money, property, or rewards;
- Theft or embezzlement by a bank employee;
- False identification of U.S. or foreign citizenship;
- False statements to purchase a firearm;
- Crimes involving fraud or false statements;
- Mail, bank or wire fraud;
- Theft of customer information from a financial institution;
- Violation of the Immigration and Nationality Act related to failing to leave the U.S. or counterfeit documents;
- Other immigration offenses; and
- False statements made under provisions of the Social Security Act.
While Section 1028A specifically enumerates the examples and instances of a felony violation, the definition applies to a wide range of crimes and offenses, The outcome of this broad definition? Almost every instance of identity theft committed today falls under this more substantial federal offense.
Investigations for Aggravated Identity Theft
Facing accusations and investigation of aggravated identity theft is very serious. As explained in the next section, the ramifications of a conviction for aggravated identity theft can alter the trajectory of your life. Avoiding or dampening these repercussions of a federal felony conviction is imperative. Your defense should begin simultaneously with any federal investigation into aggravated identity theft.
What Federal Agencies Handle Investigations?
Given the range of actions that amount to aggravated identity theft, detection and investigation of the offense can fall to almost any government agency. For example, the Medicare Fraud Strike Force may handle the investigation into aggravated identity theft targeting the Medicare system. These government agencies are the most likely to head an investigation.
- Federal Bureau of Investigations: The FBI is the lead investigative agency for most cases that involve fake IDs, such as passports, driver’s licenses, and social security cards, forged checks, Ponzi schemes, and other instances of aggravated identity theft. The investigative and intelligence capabilities of the FBI are greater than most government agencies, giving the agency an advantage when investigating aggravated identity theft committed online and via computer networks.
- U.S. Secret Service: It comes as a surprise to most people that the original objective of the Secret Service wasn’t the protection of the president. Rather, the agency was created to handle detection and investigation into counterfeiting of U.S. currency. Now, any aggravated identity theft that involves financial systems, payments to the U.S. government, or regulated financial institutions, such as banks and savings and loans, could come under investigation by the Secret Service.
- U.S. Postal Service: The Postal Inspection Service performed by the U.S. Postal Service uncovers a high volume of identity theft and fraud across the U.S. Often, the mail is used to distribute stolen information, send fraudulent documents, or order unauthorized credit cards. The Postal Inspection Service is on the lookout for any and all of these instances of possible aggravated identity theft.
- Internal Revenue Service: The IRS Criminal Investigation is responsible for the investigation into all types of tax fraud, including schemes that implicate aggravated identity theft. Often an investigation by the IRS will cooperate with the FBI to access that agency’s intelligence and knowledge of online identity theft and fraud.
The most common type of aggravated identity theft investigated by the IRS is fraudulent tax returns. The IRS runs the Questionable Refund Program, a division created to detect false, misleading, or inaccurate returns and track down the individual or company that filed the document.
How Does an Investigation Begin?
Identity theft is the fastest-growing crime in the United States. It outpaces other cyber crimes, such as malware and ransomware, and is now more common than other forms of fraud, such as bank fraud and mail fraud. Technology has a lot to do with the increase in aggravated identity theft and technology is also allowing many government agencies to detect instances of identity theft.
Many accusations of aggravated identity theft are uncovered by recent systems put in place by various agencies. These systems utilize algorithms and trends to detect anomalies in different reporting requirements or documents. For example, the IRS utilizes specific algorithms to look for inconsistencies in tax returns and withholdings.
Growing use of technology is in consumer protection. As online transactions become the most common way to do business and make purchases, it is much easier for credit card companies to implement algorithms to look for inconsistencies in spending. This leads to self-reporting by the credit card company or directly by a consumer.
Finally, aggravated identity theft and fraud committed directly against government agencies is being detected through new audit procedures. In particular, government healthcare programs are implementing audit processes that better track, review, and flag claims and filings.
The Prosecutor’s Case for Aggravated Identity Theft
It is a misconception held by many people that a criminal trial immediately follows an investigation into aggravated identity fraud. In fact, every federal criminal case follows a set of procedures and processes. The intervening steps from detection of an identity theft offense to conviction or acquittal are numerous.
- Federal Indictment: Before a federal prosecutor can have an individual arrested for aggravated identity theft, a grand jury must return an indictment on the charges. A federal grand jury has between 16 and 23 members, and the burden of proof the prosecutor must meet for an indictment is probable cause that the defendant committed aggravated identity theft.
- Arrest and arraignment: Once a federal grand jury returns an indictment, the prosecutor can obtain a warrant for the arrest of the defendant. Within a reasonable time of arrest, and typically within 48 hours of arrest, the defendant will have his or her first court appearance. During an arraignment, the prosecutor will formally charge the defendant with aggravated identity theft, and the defendant must enter a plea to the charges.
- Pretrial Release: The next court hearing in an aggravated identity theft case is a federal bail hearing to determine whether or not the defendant is granted pretrial release. If the pretrial release is approved by the federal judge, then bail is set.
- Discovery and preliminary hearings: Following a bail hearing, the federal defense lawyer representing the defendant is given an opportunity to collect evidence, request known information of the federal prosecutor, and file pre-trial motions. This phase of a criminal case is called discovery. During discovery, a lawyer may decide to take depositions, hire expert witnesses, and certify evidence for court. As well, any preliminary hearings, such as a hearing for dismissal of the charges or plea bargain, are heard during this phase.
- Criminal trial: During a federal trial, the prosecutor must prove the defendant committed aggravated identity theft beyond a reasonable doubt. The defense is given an opportunity to refute the prosecutor’s evidence and poke holes in the case to establish doubt in the jurors’ minds.
Ramifications of a Conviction for Aggravated Identity Theft
Aggravated identity theft under Section 1028A of the U.S. Code carries the potential for substantial punishment and consequences. While the most serious of these ramifications is incarceration in federal prison, there are other repercussions to your profession, reputation, and finances that could outlast the prison sentence.
Criminal Punishment for Aggravated Identity Theft
Aggravated identity theft carries a minimum term of incarceration. Under Section 1028A of the U.S. Code, anyone convicted of aggravated identity theft must serve two years in federal prison. However, defendants convicted of aggravated identity theft always serve a longer sentence than this two-year term.
Aggravated identity theft is a federal offense in and of itself, but to commit aggravated identity theft, the defendant must be simultaneously guilty of another federal crime. A defendant could be charged with bank fraud, credit card fraud, healthcare fraud, wire fraud, or a number of other offenses. The defendant will serve the sentence for this related crime consecutive, not concurrent, to the term of incarceration for identity theft.
Other Ramifications of Aggravated Identity Theft
What other ramifications should concern an individual accused of aggravated identity theft? Many. There are long-term consequences of a conviction of aggravated identity theft that can extend far into the defendant’s future or last a lifetime. These other ramifications of the federal offense enhance the need for strategic defense. You should engage a federal defense lawyer early in the process to improve your chances of a good outcome.
Some of the additional ramifications of aggravated identity theft include payment of restitution to victims of aggravated identity theft, a punishment that is frequently implemented against perpetrators of credit card fraud and healthcare fraud.
Loss of licensure or certification for your job is a major concern. As a fraud offense, there is an underlying sense of dishonesty that accompanies conviction of aggravated identity theft. This dishonesty is viewed with great skepticism by state and national licensing agencies and departments. In conjunction with concerns over licensure, a defendant should be worried about reputation harm and loss of employment opportunities. These are frequent, and sometimes irreversible, implications of a conviction for aggravated identity theft.
Recent Cases of Aggravated Identity Theft
Recent investigations and charges for aggravated identity theft exemplify the broad range of activity that qualifies as a criminal offense under Section 1028A of the U.S. Code. Recent cases include citizenship scams, Ponzi schemes, unauthorized art purchases, and credit card fraud.
- What do an art advisor from New York and an interior designer from Florida have in common? They are currently facing charges for scamming the famous auction house, Sotheby’s out of $5 million. The duo is charged with aggravated identity theft based on accusations the pair stole the identity of a wealthy, Florida retiree to purchase singular and expensive works of art.
When the woman was contacted about her “purchases” at the auction, she admitted to signing paperwork for the defendants but stated that she was unaware of the purpose or intent of the documents signed.
- Credit card fraud is one of the most common types of aggravated identity theft. In the U.S., federal investigators detect instances of credit card fraud on a daily, perhaps momentary, basis. A recent case of credit card fraud shows how the law on aggravated identity theft is used to prosecute these cases.
A woman in Clearwater, Florida was indicted in the district court located in Pittsburgh, PA for aggravated identity theft. These serious charges are based on over $144,000 in credit card transactions and purchases that the Florida woman made with credit cards obtained under a false business name. Although a relatively small amount of fraudulent activity, compared to the significant scams carried out today, this case is indicative of charges brought in federal courts every day.
- Another common fraud perpetrated by the use of stolen or fraudulent identities is tax fraud. A man in Kansas City was recently indicted for committing nearly $2.6 million in tax fraud by using children’s identities and personal information. In this instance, the defendant is accused of using his own children’s names to file tax returns with misrepresented income and withholding.
What to Do If Accused of Aggravated Identity Theft?
The consequences for federal conviction of aggravated identity theft are serious. If you are accused of identity theft, you need to take concrete and immediate steps to prevent a federal trial and conviction. Here’s where to start.
- Learn what amounts to the federal crime of identity theft and the meaning of the federal criminal statute on identity theft. You should thoroughly understand the charges against you, to best determine if you are innocent or guilty of federal identity theft.
- Look through records, documentation, online activity, and other recent events that could possibly constitute identity theft.
- Proceed with caution during conversations, interviews, and interrogation by law enforcement and prosecutors. Your federal defense lawyer should be present for any of these conversations, in particular, if you’ve been arrested and arraigned for federal aggravated identity theft.