SAN DIEGO — The hot spots for identity fraud in 2006 were not where one might expect, according to ID Analytics Inc.

Based on criminal activity and ZIP codes, the hot spots were Springfield, Ill., and the Montana cities of Bozeman and Missoula, the company says. A number of North Dakota counties also were cited.

San Diego-based ID Analytics uses data drawn from its cross-industry ID Network to calculate fraud rates based on the total number of reported successful and attempted identity frauds divided by the number of applications

"While identity fraud rates remain high in many large metropolitan areas like New York, Los Angeles and Detroit, we are seeing substantial emergence of these crimes in more rural areas like Montana and South Dakota," says Stephen Coggeshall, ID Analytics' chief technology officer.

"This may indicate a trend toward popularization of this crime, as well as point out that perpetrators are discovering that they can act under the radar in these remote rural areas," Coggeshall says.

The calendar-year 2006 data is the most recent available, the company says. The three cities were identified by using five-digit ZIP Codes. Using the three-digit ZIP Code level, its research found 13 counties in North Dakota and seven in Montana as hot spots.

Identity fraud rates also are generally increasing in the upper Midwest, Northern California, Utah, Nevada and Maine, ID Analytics says. They appear to be decreasing in the southern U.S. and staying consistent in Southern California, the Mexican border of Texas and in cities that include Seattle and Portland, Ore., the company says.

ID Analytics used data from its ID Network, which comprises 3 billion identity elements–including names, addresses, Social Security numbers and phone numbers–which are contributed in real time, by organizations spanning multiple industries, to help prevent identity fraud.

Applications studied were submitted to credit grantors from January through December 2006, and the study compared the fraud rates in the second half of 2006 to the first half.

The company says its scientists believe the majority of fraudsters are using synthetic identities comprising real and false identity elements. Its research shows that identity theft victimizing an actual consumer (true-name identity theft) accounts for only 10% to 15% of all identity fraud.

ID Analytics is offering a white paper with more detailed findings on its research. It can be requested by e-mail at [email protected].

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