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New study says Chicagoans among biggest victims of data fraud

Chicagoans have one strongest data-breach notificatifraud laws natibut are among biggest victims having their datused for fraudulent online purchases new

Chicagoans have one of the strongest data-breach notification fraud laws in the nation, but are among the biggest victims of having their data used for fraudulent online purchases, a new study finds. | Sun-Times File Photo

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Updated: July 16, 2014 4:36PM



Chicagoans have one of the strongest data-breach notification fraud laws in the nation, but they are among the biggest victims of having their data used for fraudulent online purchases.

That’s one of the findings of a study released Wednesday by a consumer-advocacy group that called on Congress to pass a comprehensive data-security law so everyone would get immediate notification of the widest-possible violations. The proposal calls for the new law to set a national data-breach notification standard.

The National Consumers League, the private, non-profit advocacy group based in Washington, D.C., held a news conference Wednesday at the 1871 technology hub in the Merchandise Mart to unveil its campaign, which includes a Twitter promotion — #DataInsecurity — to raise awareness and push for action on consumer data security.

The league’s study, done in partnership with Javelin Strategy & Research, based in Pleasanton, Calif., focused on data breaches and identity theft in four cities: Chicago and Los Angeles, due to their respective state’s strong anti-fraud laws; Miami, because Florida has the nation’s highest per-capita rate of identity-theft and fraud complaints to the Federal Trade Commission; and Minneapolis, because it is the headquarters for Target Corp., victim of a data breach that let hackers access payment data on 40 million customers’ debit and credit cards.

The study findings showed:

◆ Chicagoans whose information is stolen are more likely than victims in Los Angeles and Miami to get a double whammy: The thieves use the stolen information to make online purchases in 43 percent of the instances, compared with 50 percent in Minneapolis; 35 percent in Los Angeles and 31 percent in Miami.

◆ They should check in-person misuse of their information, too, since 28 percent of the Chicago fraud victims had their information used to make fraudulent purchases in person, often by “runners” who may use counterfeit cards to purchase merchandise for resale or pre-paid debit cards to get cash out of ATMs, said John Breyault, of the National Consumers League.

◆ In Chicago, 72 percent of fraud victims also are victims of data breaches, such as the much-publicized hacking at Target Corp. stores.

In 2013, Madigan’s office saw a 1,600 percent increase in data breach complaints compared to the year before. The office received more than 20,500 complaints in 2013.

Email: sguy@suntimes.com

Twitter: @sandraguy



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