Hatch: End sales of driver’s license data

01/05/2006

Minnesota driver’s license records sold to online businesses are a major aid to check counterfeiters, the attorney general alleges.

Conrad Defiebre,
Star Tribune
Last update: January 05, 2006 – 9:58 AM

State government is aiding and abetting check-counterfeiting identity thieves by selling driver’s license data cheaply to nearly all comers, Attorney General Mike Hatch said Wednesday in calling for the Legislature to halt the practice.

“The government doesn’t have to be a sieve” leaking names, addresses and license numbers to businesses that sell the data to scam artists, Hatch said at a State Capitol news conference that set off a flurry of political recriminations.

After Hatch, a DFL candidate for governor this year, suggested that “the governor and the state” are in effect assisting the scams, Gov. Tim Pawlenty accused his political rival of “making allegations that are not very responsible.”

The Republican governor said his administration has followed state law that allows dissemination of the information. Moreover, he said, he has been a proponent of tightening the law, but his proposals have been rejected by the Legislature.

Hatch shot back that Pawlenty has opposed changes.

Not only has Pawlenty blocked reforms proposed by the attorney general, but he also failed to take administrative steps to address the problem, Hatch said.

“The business community likes having all this data out there,” Hatch said. “The governor could have done something with this and he hasn’t.”

Pawlenty, meanwhile, has scheduled a news conference today on identity protection.

“We think the law should be changed,” he said. “We can work together and get this done rather than trying to politicize the issue.”

Offshore online service

Hatch was joined at his news conference Wednesday by a detective with the Minnesota Financial Crimes Task Force who described a recent explosion of check counterfeiting enabled by an offshore online service at http://www.publicdata.com, which buys public databases and resells them over the Internet.

“There have been hundreds and hundreds of victims,” said the officer, Jack Talbot. “I had 15 victims last week alone. Why rob a bank when this is so easy?”

Virtually all 3.5 million Minnesota driver’s license holders are vulnerable despite a federal law and state rule banning the sale of the information without the licensee’s consent on a checkoff form, because so many exceptions exist, Hatch said.

“Nobody’s checking the box, but the state is still selling it,” he said. “Other states don’t disclose this data.”

Minnesota is one of only about nine states whose license data are available on publicdata.com, Hatch said. “Minnesota is in the bottom five states for data security,” he said. “We may be the worst state for security.”

Hatch proposed to prohibit bulk distribution of driver’s license data without the licensee’s express consent, except to government agencies. In addition, the state would be required to report information requests to licensees.

Hatch also urged establishment of a $5 fee per name accessed, money that would finance both the driver’s license bureau and the Financial Crimes Task Force, whose funding has recently been cut. Currently, the state provides the entire driver’s database to more than 5,000 public and private entities for a flat $1,100 fee and $450 monthly updates.

Pawlenty said that only recovers the cost of providing the data, as required by state law.

A data giveaway?

Hatch’s plan will be sponsored in the Legislature by Sen. Ann Rest of New Hope and Rep. Jim Davnie of Minneapolis, both DFLers.

“I am surprised that the state of Minnesota imposes fees on virtually every aspect of our lives, but then gives away valuable data to commercial interests that are not even located in this state,” Davnie said. “The result is more identity theft and less protection for our citizens.”

Talbot, who works with the task force through his post at the South Lake Minnetonka Police Department, said the check-counterfeiting scheme usually begins with theft of a checkbook or an account number supplied by an unscrupulous store clerk or bank teller. But the driver’s license number is a key element in verifying checks when they are passed, he added.

That’s where publicdata.com comes in, Talbot said. Its Minnesota driver’s license lists have repeatedly been recovered in searches of the premises of suspected check counterfeiters, he said. Spokesman Kevin Smith said the Department of Public Safety has not sold lists to the Internet company, based on the Caribbean island of Anguilla.

But its website lists Minnesota driver’s license numbers among its offerings. A call to the firm for comment Wednesday was not returned.

Talbot said individuals can do little to avoid victimization, but they should check their bank accounts online daily to halt scams quickly. “Once they hit you, it will be 10 or 15 checks passed in a day,” he said.