Protecting Government Services from Identity Theft and Fraud: At What Cost?
When it comes to targets of identity theft and fraud, what is the first thing that comes to mind? For most of us, we tend to think of online businesses, major retailers, and banks. But what about governments?
To apply for government benefits, citizens and residents typically need to use a unique government-issued identification number such as the U.S. Social Security Number and the Canadian Social Insurance Number. Being such an important and valuable piece of personally identifiable information, it is a favorite target for identity thieves.
In the United States, identity thieves stole at least $5.8 billion in 2013 from the federal government through tax refund scams. With the use of tax software steadily gaining in popularity, fraudsters have seized upon the chance to take advantage of the situation by using identity information stolen from data breaches to file fake income tax returns. Once the criminals have the necessary personal information, it’s easy for criminals to steal from the public purse.
What can governments do to mitigate identity theft and fraud?
Issue secure identity documents
Just as counterfeiters continue to keep up with central banks that issue national currency, the same can be said for government-issued identification.
To prevent cases of in-person fraud, governments should design and distribute identity documents that are difficult to replicate using anti-counterfeiting measures. For example, the Canadian province of Ontario has recently announced that they will now issue new birth certificates using new security features and printed on polymer material instead of traditional paper.
Verify document authenticity
Even though governments may invest significant sums of money into designing and producing secure identity documents, fraudsters will nonetheless persist in trying to play the system. An additional layer may be necessary to detect forged government ID.
In certain countries, such as Australia, there are document verification services available that can be used to confirm whether or not an identity document is authentic and valid. These services are typically set up through partnerships with various levels of government in order to provide the best coverage.
Use online identity verification
Due to an alarming increase in tax refund fraud in the United States as a result of identity theft, the Government Accountability Office has recommended slowing the rate at which refunds are paid out. While introducing greater oversight and due diligence in government services is vital to control identity fraud, citizens and residents should not have to pay the price by suffering increased delays.
Online identity verification can help governments build public confidence and trust by quickly detecting identity theft and preventing fraudulent benefits claims based on stolen identities. By verifying identities online, governments reduce overall costs and the need for manual ID checks, enabling timely delivery of government services. In addition, address verification ensures that important mail such as notifications, legal documents, payments, and statements are sent to the correct address.
Train staff to recognize and report identity theft
Governments should invest in training their employees on how to quickly recognize typical signs of identity theft and the correct method of reporting it to the appropriate authorities. Part of the training can also include readiness exercises to put the new skills into practice before using them in the real world.
A model that governments could follow is the U.S. Federal Trade Commission’s Red Flags Rule that requires businesses and organizations to have a written identity theft prevention plan in place. This is intended to help businesses mitigate the damage from identity theft and could be the basis for new government operational policy.
Educate the public on how to protect their information
When it comes to combatting identity theft, public education and awareness is essential. Many governments already provide online resources and information, such as Australia, Canada, the United States, and the United Kingdom. Actions such as keeping computer software up to date, protecting home wireless networks, and installing security software are just a few things that individuals can do to protect themselves online.
Although these resources and information are easily accessible by everyone, public awareness of their existence may not be at an adequate level. Promotional campaigns and media publicity can help draw greater attention to this growing issue.
Work closely with the private sector and law enforcement
The concept of close collaboration between the public and private sectors concerning cybersecurity is hardly new. Canada, the Netherlands, and the United States are just a few examples of countries that have published documents or statements about governments working closely with businesses to fight cybercrime.
Despite the existence of these partnerships, hackers continue to become more organized and coordinated in their attacks. Governments, businesses, and law enforcement agencies must redouble their efforts to work together more than ever before to curb the growing trend of new data breaches.
Without question, identity theft and fraud is a growing problem globally. Just like businesses, governments need to tighten security measures to safeguard citizens and residents. Governments will stand a fighting chance against cybercriminals when they take a multifaceted approach to this issue. Every part of our society has its role to play, and every positive action makes a difference.
What challenges do governments face when it comes to building up their cyber defenses?