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article imageStudy: Customers at Bank of America, HSBC Most Prone to Identity Theft

By David Silverberg     Feb 29, 2008 in Business
Customers at Bank of America and HSBC are at the greatest risk of identity theft, according to an eye-opening report. Analyzing identity theft complaints in 2006, researchers also found that ING is the safest U.S. bank.
Digital Journal — Identity theft is a problem that isn’t going away, and now customers can vote with their feet when they choose a bank that will protect them from this criminal scourge.
A new report ranks the top U.S. banks that have received the most identity theft complaints, and two large institutions crowned the list: Bank of America and HSBC were the riskiest banks, according to complaints filed with the Federal Trade Commission for January, March and September of 2006.
Completed by Chris Hoofnagle, a senior fellow at the Berkeley Center for Law and Technology at the University of California at Berkeley, the provocative report factored in the total amount of deposits per bank as of Dec. 31, 2006, to account for size in the financial services industry. The report’s abstract says “this complaint data identifies the institution where impostors established fraudulent accounts or affected existing accounts in the name of the victim.”
Looking at estimated annual incidents per billion in deposits, HSBC ranked first with 21.3 and Bank of America took second with 17.6. Washington Mutual, Wells Fargo and JP Morgan/Chase didn’t fare much better.
Suffering from the least amount of identity theft incident were the smaller banks: ING Direct (0.085), Comerica (1.4), Merrill Lynch (1.8) and Union Bank of California (2.2).
Hoofnagle said his report should come as a wake-up call to banks:
"There is no reliable way for consumers, regulators, and businesses to assess the relative incidence of identity fraud at major financial institutions. This lack of information prevents more vigorous competition among institutions to protect account holders from identity theft."
Hoofnagle, who began his career as a privacy and consumer rights advocate at the Electronic Privacy Information Center, used an open-government request to receive more than 88,000 complaints filed by individuals to the FTC. Hoofnagle’s paper does not factor in police reports filed or incidents reported to cell phone companies or credit bureaus.
More about Hoofnagle, Identity theft, Banking, Hsbc, Ing