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Chapter 1. IDENTITY THEFT > Phishing—Go Phish

Phishing—Go Phish

You may remember the commercials by Citibank about its identity theft protections in which the voice of a young woman describing the bustier she bought with her credit card comes out of the body of an overweight, slovenly man. The ads made their point, but unfortunately so did the identity thieves who targeted Citibank and other companies through a tactic known as “phishing” in which they sent e-mails to unsuspecting consumers telling them that they needed to click on a hyperlink to update their information with the companies. When unsuspecting victims clicked on the hyperlink, they came to a website that looked like the real McCoy, or Citibank for that matter, but it was a phony. When the consumer entered his or her personal information, such as Social Security number or a credit card number, the identity thief had all he or she needed to either use the information to steal the identity of the victim or sell the information to other thieves. In the last two months of 2003, Citibank issued fourteen alerts to its customers warning them of this dangerous scam.

The term “phishing” goes back to the early days of America Online (AOL) when it charged its customers an hourly rate. Young Internet users with an addiction to their computers, not very much cash, and bit of larceny in their hearts sent e-mails or instant messages through which they purported to be AOL customer service agents. In these phony e-mails under those false pretenses they would ask for the unwary victim's passwords in order to stay online on someone else's dime. After a while, this phony fishing expedition for information came to be known as “phishing.”

Phishing with a Pal

PayPal is a company with which anyone who has ever bought something on eBay is familiar. PayPal is an online payment service, owned by eBay, used to securely transfer money electronically. Through the popularity of eBay's online auction site, PayPal has gathered forty million customers who use its services to make sure that the exchange of funds for auctioned items is done safely and securely. But for many people that safety and security are an illusion. Through phishing, a con man sets up a website that imitates a legitimate website, such as PayPal, but whose sole purpose is to obtain sensitive personal financial information that can be used to facilitate identity theft. With the computer and software technology so readily available to pull off such a crime, the skill and artistry of the forgers of yesterday are not needed by the identity stealing phishers of today.

Through phony e-mails that looked like they were from PayPal, the identity thieves contacted retailers that used PayPal's services and requested confirmation of their passwords and other account information. According to PayPal, the passwords requested provided the criminals with access to sales information, but fortunately the personal financial information of their customers is stored on separate secure computer servers that are inaccessible to merchants or others that use PayPal's services. That is the good news. The bad news is that, armed with customers' names and other information about their previous purchases obtained through this scam, the con men were in a position to contact the customers directly and trick the unwary customers into revealing personal financial information that opened the door to identity theft. In the past, con men have sent e-mails purporting to be from PayPal, telling the customers that their accounts would be put on a restricted status until they completed a credit card confirmation that could be found on the PayPal site to which the e-mail directed the consumer. Unfortunately, the Web site to which the consumers were directed was a phony site used by the criminals to phish for victims. Previously, criminals would just randomly send out millions of e-mail messages, hoping to snag a few unwary victims. However, armed with personal account information surreptitiously obtained from PayPal using merchants, the phony e-mails would appear more legitimate and thus they were more likely to take in more victims.


PayPal never asks for personal financial information by way of e-mail and never refers to previous transactions through e-mail. If you get such an e-mail, do not reply to it, but inform PayPal by telephone directly of the e-mail message you received.

Former Good Advice

Smug consumers used to be able to identify a phishing expedition by merely looking at the Web browser's address window to determine whether the e-mail purporting to be from some company with which they generally deal was legitimate. If the sender's e-mail address began with an unusual number configuration or had random letters, it indicated that it was phony. The e-mail addresses of legitimate companies are usually simple and direct. Unfortunately, this is no longer the case. Now computer savvy identity thieves are able to mimic the legitimate e-mail addresses of legitimate companies.

Two Things to Look For

When identity thieves mimic a legitimate company's e-mail address using the latest technology, there will be no SSL padlock icon in the lower corner of your browser. SSL is the abbreviation for Secure Sockets Layer, an Internet term for a protocol for transmitting documents over the Internet in an encrypted and secure fashion. In addition, when you type a different URL (the abbreviation for Uniform Resource Locator, the address of material found on the World Wide Web) into what appears to be the address bar, the browser's title will not change from the phony “welcome message.”

More Good Advice

Don't fall for the bait. It takes a few moments longer, but if you are in any way inclined to respond to an e-mail that could be phishing to send you to a phony website, do not click on the hyperlink in the e-mail that purports to send you to the company's website. Rather, type in what you know to be the proper website address for the company with which you are dealing.

AOL Scam

In a phishing case brought by the FTC and the Justice Department, it was alleged that Zachary Keith Hill sent out e-mails to consumers that looked like they were from America Online. The e-mail address of the sender indicated it was from the billing center or account department, and the subject line contained a warning such as “AOL Billing Error Please Read Enclosed Email” or “Please Update Account Information Urgent.” The e-mail itself warned the victim that if he or she did not respond to the e-mail, his or her account would be cancelled. The e-mail also contained a hyperlink to send unwary consumers to a web page that looked like an AOL Billing Center. But it was a phony web page operated by Hill. At the web page, the victim was prompted to provide information such as Social Security number, bank account numbers and bank routing numbers as well as other information. Hill, in turn, used this information to facilitate identity theft. The FTC eventually settled its charges against Hill, who agreed to refrain from ever sending e-mail spam or setting up fictitious and misleading websites. As with just about all FTC settlements, Hill did not admit to violating the law, but he did promise not to do it again.

Phishing with a Large Net

The Phishing Attack Trends Report is published monthly online at www.antiphishing.org by the Anti-Phishing Working Group, an organization dedicated to eliminating identity theft resulting from phishing. In a recent monthly report the report stated that the companies most often imitated by phony phishing websites were eBay, Citibank, AOL, and PayPal.

Phishing Around the World

In an effort to clean up its own house, EarthLink, the Internet access provider, went on a phishing expedition, trying to trace the purveyors of phony phishing schemes, and what they found was both startling and disturbing. Many of the phishing scams they were able to track originated in e-mails from around the world, particularly Russia, Romania, other Eastern European countries, and Asia. In Romania, Dan Maarius Stefan was convicted of stealing almost a half a million dollars through a phishing scam and sentenced to 30 months in prison

For every computer geek or small time phisher, such as convicted identity thief Helen Carr who used phony e-mail messages purporting to be from AOL to steal people's money, it appears that more sophisticated organized crime phishing rings are popping up, posing a serious threat to computer users. This presents a growing problem for law enforcement.

National Do Not E-Mail Registry

The National Do Not Call Registryadministered by the Federal Trade Commission has been a boon to many people who do not wish to be annoyed by telemarketers. It would only seem logical that a national do not e-mail list would offer similar benefits to people wishing to avoid spam, the commonly used term for junk e-mail. It might seem logical, but there is no law providing for such a list. When you see a solicitation to sign up for a“National Do Not E-Mail Registry”what you are actually seeing is another phishing expedition seeking to snare your personal information and steal your identity. Don't fall for it.

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