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Bounded Rationality of Identity Thieves: Using Offender-Based Research to Inform Policy

NCJ Number
Criminology & Public Policy Volume: 8 Issue: 2 Dated: May 2009 Pages: 237-262
Date Published
May 2009
26 pages

Based on data obtained from semistructured interviews with 59 inmates serving sentences in Federal prisons for identity theft, this study examined how offenders' experiences and life circumstances influenced their assessments of risks and rewards in the course of deciding to engage in identity theft.


The primary motivation for engaging in identity theft was money. The amount of profit gained from each identity theft varied according to the method used by an offender to convert a victim's information into cash and/or goods and the financial status of the victim. Methods for using the victim's information for personal gain included applying for credit cards in the victims' names, opening new bank accounts and depositing counterfeit checks, withdrawing money from existing bank accounts, applying for loans, and applying for public assistance programs. The most lucrative form of identity theft involved mortgage loans; for example, some who were mortgage brokers used stolen identities to apply for mortgages on homes whose values had been inflated by an appraiser who was in on the scheme. They would then pay a "straw" borrower to get the loan using the stolen information. This yielded profits of hundreds of thousands of dollars. Regarding perceptions of the risks of identity theft, the identity thieves were apparently blinded to the risks of adverse consequences of their actions by their focus on the riches to be made. More than half of the identity thieves interviewed ignored the long-term consequences of their crimes. Many claimed that if thoughts of getting caught entered their minds, they were suppressed or minimized. In addition, they believed their schemes were so well-crafted that law enforcement agencies would not be able to identify their true identities and/or locations. Policy recommendations focus on interventions designed to change the way offenders think about their crimes. 59 references

Date Published: May 1, 2009