Working Paper

Credit and identity theft


Abstract: The quintessential crime of the information age is identity theft, the malicious use of personal identifying data. In this paper we model ?identity? and its use in credit transactions. Various types of identity theft occur in equilibrium, including ?new account fraud,? ?existing account fraud,? and ?friendly fraud.? The equilibrium incidence of identity theft represents a tradeoff between a desire to avoid costly or invasive monitoring of individuals on the one hand and the need to control transactions fraud on the other. Our results suggest that technological advances will not eliminate this tradeoff.

Keywords: Identity theft;

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Bibliographic Information

Provider: Federal Reserve Bank of Atlanta

Part of Series: FRB Atlanta Working Paper

Publication Date: 2005

Number: 2005-19