Impact of Identity Theft in E-Commerce

Impact of personal identicalness larceny in E-CommerceABSTRACTIn the world of today, where time is cash and breeding is a corporate asset, protection of info secludedity and integrity has make up critical. Today, companies ar foc employ much to a greater extent on how to secure their craftes from individuality baloney, which has emerged as the modern day menace. As I found research on identity stealth is rather limited. This research lead provide more knowledge of the subject.The advise of this research at that placefore was to find and assess the impaction and the level of identity theft in e-commerce. This was achieved by using analytic induction from the existing research literature and analysis of feed back from the various business executives, industry specialists and comp any(prenominal) clients done a questionnaire. after(prenominal) introducing identity theft and its impact on the corporate sector in detail, in the first two chapters with the info protecti on laws it discusses their merits, demerits, controls and loopholes, the third chapter of this discipline delves into the methods and techniques use to prevent identity theft, it discusses in detail their efficacy, efficiency, implications and limitations while the last chapter is a case train of an cheek where , existing data has been collected from various sources and has been critic each(prenominal)y analyzed and reviewed.A quantitative method apostrophize has been employed in carrying out this research, besides carrying out a case study of an organizationMore everywhere, aim to decrease the risk and cause of identity theft in e-commerce possible best practice techniques were identified through this research which was achieved through a study of existing literature which results the formation of a policy document. This policy document was in addition evaluated by industry experts.INTRODUCTIONLike Mcleod and Scheel (2001) pronounces, e-business creates higher customer satis faction, by providing quicker service, less(prenominal) effort to buy a product or service, and less business cost compared to a business run without the use of information technology (IT).Internet is also called worldwide net black market of computers. It provides excellent opportunities for an organization to do their business online. To get more customers and to increase the publics awareness of the business, it is very meaty to represent themselves on the Internet and their products, resulting in increased sales volume and higher profits. Security implications hold back the business. Nowadays, Credit board companies, banks and software companies work together to produce a broad standard to do condom online business. Whereas on the other hand System Hackers are trying to get as much information as possible, which they shadower easily sell in the black market. Some of the staff in companies also busy in interchange their customers details in the same black market. Specific g uidelines should be followed by companies to develop a safe and successful appearance in the online business.Some critics standardized Professor Richard Walton CB, (2005) however quarrel, The rise of the Internet and other modern technologies has brought about a fundamental change in commercial life. He further says that thieves energise been stealing wallets and credit cards for a long time, but the growth of online buying and on-line banking has made Identify Theft the closeest growing white-collar crime in the U.K. and America, Its a big problem, and it put forward obtain to anyone.On the other hand, roughly concourse are disagreed that the major cause of Identity theft is internet. As per Thomas C. Greene (2005) he said, that The vast mass of incidents keep be traced to (what he calls) skimming, or dumpster diving, he goes further to say that plain stupidity among those who cause our personal data are also contributive. Only a small fraction of such incidences result f rom on line transactions. I found majority of research is on the topic of identity theft, which usually consists of some variations in the phrase identity theft is the fastest growing crime in the get together kingdom or it begins with a quaint anecdote about the tens of thousands of identity theft victims that emerge each year.According to a report published in the American angle, Anne P.Minz (2002) which says that the consumer sentinel network of agencies gathering data on e-commerce fraud, reports that in 2001 alone, there were 204,000 complaints, compared to 138,900 reported in 2000. It is noticeable that 47% increase demonstrates the growing spirit of the problem. Figures such as the ones noted above are apparently disconcerting, in other to glean possible remedies which in turn demands for additional research on this issue.There are so many occasioning of identity theft and different ways this may be consummate. The everywhereheads and wounded are considerable to financial institutions as well as individuals, but the overheads are practically difficult to reveal or enumerate, importantly for individual punter sufferers. If an individual is auspicious abounding to avert financial responsibility for the theft, in so many ways they still endure losses in different ways, which may not be substantial most of the time the affecting damage is very heavy that some sufferers commend suicide while so many others hunt for therapeutic or psychiatric assistance. In an attempt to recover from the theft or loss, sufferer may end up costs more money and time.These two essential not be perplexed as theft resembles fraud in that and both engagedin some form of unlawful takings, but fraud requires an extra character of false pretenses formed to persuade a sufferer to turn over wealth, property or other operate. Theft, by difference, needs only the illegal catch of anothers possessions withthe aim to enduringly divest the other of the possessions. Harsh punishme nt is for fraud because of more planning is involved in that than does the theft.However, for the use of this study we are breathing out to focus on identity theft in e-commerce in openinging the effect on online business in UK.Definition of IdentityDefinition of TheftTheft can be defined as per English Law act 1968 section (1). Subsection (1), that a person is guilty of theft if he is venally appropriates property belongs to another with the purpose of enduringly miserly the additional of it and that steal and theft shall be construed consequently. It is irrelevant whether the appropriation is made with a view to expand, or is made for the thiefs own benefit.As per encyclopedia dictionary 2007, Some clock theft is used synonymously with larceny as a term however, we can say that, it is actually a broader term, encircling many forms of dishonestly taking of property, including cheating, double-crossing and false pretenses. Some states categorize all these abominations under a sin gle statutory crime of theft. Property belonging to another is taken without that persons consent will be assumed as theft, where Theft could be regarded as savage act. mavin of Identity TheftIn the Identity theft and assumption prevention Act of 1998 the term identity theft was first codified, where the act makes it as a federal crime when someone deliberately uses or transfers, without legal permission, a means of identification of another person with the aim to commit, or to aid or support, any unlawful activity that constitutes a breach of federal law, or that constitutes a offense under any applicable state or local anesthetic law. In addition, the act defines it as a means of identification as any find or number that may be used, alone, or in combination with any other information, to identify a specific person. Identifying information is noted to be, surrounded by other things, passport number, a name, date of birth, drivers authorise or national insurance number (NI), acc ess device or telecommunication identifying information.Identity theft may be broadly defined as the unlawful acquirement or the use of any aspect of an individuals personal information for committing some form of criminal activity (Hoar, 2001 LoPucki, 201 Slosarik 2002). This definition is proposed to cover any type of crime that falsely uses a victims name, home address, bank account, credit / debit card number, national insurance number, date of birth, etc. (Federal trade commission, 2004) semiformal Definition of Identity TheftAlthough the act of plain embezzlement ones private information is an offense, the key factor to be notable here is that this information is and so used to declare to be someone else. In other words we can say when someone else uses your identity as his own with the ultimate want for fiscal, material, and monetary gain.The Internet, the evolution of e-commerce, online shopping, and wireless cap great power, the explanation of identity theft can be furth er extended to comprise such things as the hacking into the customer databases of round organizations stealing of usernames and passwords the theft and hacking of network login sessions and onwards.The development of e-commerce and particularly Wireless has compounded the problem of identity theft. Basically, it can happen beat yet to anyone, anywhere and at anytime, at variable edges in the way that information can easily be stolen. For example, Identity theft can occur by an individual simply rummaging through the trash cans at the local dumpster (the technically it is well-known as Dumpster Diving, and will be discussed later).Identity theft can also happen at your workplace, particularly if you do most of your work through telecommuting over a wireless link. Suppose yourself sitting in a caf at the train station, and while you are waiting for your train. Your laptop computer is connected to the Hot Spot or wireless link at the caf, and you access your confidential customer dat a as well as an important work e-mail, but how do you know if the wireless link is for authentic? For example, there could be someone sitting next to you, and this person could encounter set up a fashion wireless access point, and you unintentionally logged into that, thinking that you have rattling linked to a legitimate, safe and encrypted wireless link. Now, you can see that, this person has all the right to use your customer information, usernames and passwords as a result of that fake link, or rogue Wireless access link, And then you are completely unaware to all of this (this situation is well-known as The Evil Twins).Nowadays, you can see every where there is perpetually a case of theft of identity release on almost every day. First, it was simply stealing a Bank Account Number or 16 digits credit card numbers, but now this crime is going on a large scale, where it affects millions of hoi polloi all at once. Some peoples working in companies where they are steeling and selling customers full details under the table. As according to the BBC world report (March-2008) on local TV news, that HSBC Bank lost one data disk (compact disk) of their customer details.As we move more towards a wireless and mobile world, people who launch identity theft attacks are becoming much more stylish in the manner in which these attacks are launched. We are also perceive a trend today where large corporations are becoming very complacent in protecting their customer databases from these attacks. There are also trends going on where small, Wireless devices with huge capacity are being used in identity theft crime, and private information is even sold during auctioning processes over the internet.Definition of the term Electronic CommerceElectronic Commerce refers generally to all forms of commercial transactions involving both organizations and individuals, that are based upon the electronic touch and transmission of data, including text, sound and visual images (OEC D, 1997),Electronic commerce is about doing business electronically. It is based on the electronic processing and transmission of data, including text, sound and video. It encompasses many various(a) activities including electronic trade of goods and services, online delivery of digital content, electronic fund transfers, electronic share trading, electronic bills of lading, commercial auctions, collaborative design and engineering, online products (e.g. consumer goods, narrow medical equipment) and services (e.g. information services, financial and legal services) traditional activities (e.g. healthcare, education) and new activities (e.g. virtual malls). (EC document, 1997)Electronic commerce is the carrying out of business activities that lead to an exchange of comfort across telecommunication networks (EITO, 1997)E-commerce involves business transactions conducted through computer networks. The e-business literature deals with the technical facilities needed to run a busines s smoothly.(Laudon and Laudon, 2000) E-business creates higher customer satisfaction, by providing quicker service, less effort to buy a product or service, and less business cost compared to a business run without the use of information technology (IT) (McLeod and Schell, 2001). two of these approaches to e-business point to changes in the entire vision of a classical understanding of business.Service industrys challengesCompanies are using electronic funds transfer (EFT) for their customers as the fast and secure way of transactions, at present there are two most excellent ways to handle money online personal checks and credit cards, there are other fast and secure methods to exchange funds online. Electronic funds transfer (EFT) is another name for online money exchange. Here, the exchange of digital money is involved amid buyers and sellers. In the front customer authorization is made over the Internet where Banks handles the transactions behind. To ensure higher level of secu rity specialized authentication systems should be adopted. IDs and passwords are one of the most fashionable methods of data security are in use to access a server or Internet site, but these are often poor. To address this problem, Axent Technologies has developed hardware and software solution called Defender that creates unique, one-time passwords that cannot be guessed, shared, or cracked (Venetis, 1999).The system incorporates software on the users computer that communicates with the Defender Security Server on the other end. When the user connects with the server, a software token is activated that automatically establishes a confabulation with the server. A new password is generated during each session, removing any possibility that the user will forget to change his/her password on a regular al-Qaida (Venetis, 1999).This study aims not only to evaluate benefits of adopting secure solution to identity-theft, but also to see that what best practices should be adopted by the Companies, which add value to their online business. Through in-depth research, I will be able to examine why customers switch to new online companies for their shopping. I will see techniques other companys uses to give self-reliance to their customers to retain them. Although there is a very limited research available on prevention of identity theft in e-business, but my aim is to study how I can contribute from the experiences of other companys perspective. By using quantitative method approach, I will try to test the current literature available on the subject matter.The study is based upon research conducted throughout the report from a variety of sources. The scope of the study is the assessment of tools, technologies and architectures that may involve in identify theft in e-commerce. As the scope of Identity theft in e-commerce is a diversified, so I have limited my research to online fraud detection and prevention methods.Why this research?The books provides insights into factors underlying the impacts of identity theft on e-business and failure results customers lack of confidence, inappropriate variety of technologies structures, lack of ability to control and secure online businesses, lack of adoptable techniques and processes, but lack of study on how to secure online business.Research QuestionsTo concentrate the research primary and twinklingary questions have been devised to establish a central path to guide the research.PRQWhat technologies are currently in place to combat fraud and how do they work?SRQLooking at previous fraud prevention techniques, have new technologies actually prevented and deterred fraud from the mainstream areas?The past study on identity theft in e-commerce was not enough to solve the problems. As the cyber crime growing rapidly, it is very difficult to secure online business. The purpose of this dissertation was to investigate why the organization like XYZ UK Limited not able to continue their online businesses and w hat new techniques and best practices are in use by others to run their online businesses. What are the techniques that were appropriate for identity management and how well the organization (XYZ UK limited) complies with thesetechniques? The quantitative data was collected through an online questionnaire addressed to approximately 50 business executives, partners, experts and consumers.AIMS AND OBJECTIVESThis research emphasizes the issues in private company (XYZ-UK Limited) regarding the risk and impact of identity theft that company had faced while doing online business and also the problems they had been through in transactions, made on the Internet.I will also put ship what new techniques should be adopted to increase more business and customers satisfaction. To see companies involved in e-business and how to chastise their problems. Adopt new techniques and ideas to have secure online business. pursuit are research objectivesTo analyze, the affect of cyber crime on businesse s and with its consequences on customer relationship.Determine the protection level that the company has provided through its securityPolicy to fight down the privacy of their customers sensitive information and determine its compliance with industry best practices.To identify the reasons that results for the company in suffering loses and losing business opportunities and determining their plan to overcome those constraints.Analyzing new strategies acquired by the company to achieve the level of protection and review their effectiveness in accordance with existing practices.To provide opinion whether new methods for safe on-line business ensure customers satisfaction or need of improvement.Organization of ResearchThis research is organized as follows. The first chapter, as noted, introduces the research and objectives. The second chapter provides the brief overview of literature on identity theft in e-commerce and describes the critical background identity theft associated with e- commerce., and third Chapter consists of Methodology. Chapter 4 Analysis of the findings of Survey as well as content analysis to assess the scale of the effect of these factors on e-commerce success as supposed. Chapter 5 is a policy document can be used as best practices.CHAPTER2Literature ReviewWhats my ROI on e-commerce? Are you crazy? This is Columbus in the new world. What was his ROI? (Andy Grove, chairman of Intel)CHAPTER TWOLiterature ReviewDEFINITION OF E-COMMERCEVarious definitions of e-commerce are there the one given at this point is an attempt to relate to this research.Electronic commerce is about doing business electronically. It is based on the electronic processing and transmission of data, including text, sound and video. It encompasses many diverse activities including electronic trading of goods and services, online delivery of digital content, electronic fund transfers, electronic share trading, electronic bills of lading, commercial auctions, collaborative des ign and engineering, online products (e.g. consumer goods, specialized medical equipment) and services (e.g. information services, financial and legal services) traditional activities (e.g. healthcare, education) and new activities (e.g. virtual malls). (EC document, 1997)While, be the term Electronic Commerce ranges from broad (EITO) to the very narrow (OECD), basically they are equivalent. A patent description of transactions rather than the scope of activities are there. A hurdle in drafting a precise definition of e-commerce is the continuing evolution of science and technology and its impact on ever-changing environment. (Civil Jurisdiction, 2002)Identity theft may be broadly defined as the unlawful acquirement or the use of any aspect of an individuals personal information for committing some form of criminal activity (Hoar, 2001 LoPucki, 201 Slosarik 2002). This definition is proposed to cover any type of crime that falsely uses a victims name, home address, bank account, cr edit / debit card number, national insurance number, date of birth, etc. (Federal trade commission, 2004)Some authors and authorities have obviously been some hard work on the result of identity theft to those whom their identity had been stolen they were trying to see how identity theft can be avoided and possible ways to avoid ones identity being stolen by the criminal specially in online business and to find what identity theft in e-commerce is about.For instance, Mehdi Khosrowpour (2002) defines identity theft is a form of hacking which results in possession of personal data and information by the hackers to masquerade as the true identity owners for future use.IMPACT OF CYBER CRIMES ON BUSINESSE-commerce oriented communication channeles are often having a aid that exposing security weakness gives the opportunity to hackers to penetrate into business sensitive information and do the damage. These concerns have shown to have negative impact on consumer attitudes toward using th e Internet to make purchases. (Koufaris, 2002) The outcome is failure in doing business online. The losses can be divided into direct and indirect losses. The complete impact of identity theft is not completely understood so far, but latest researches importance the fast development and major costs linked with the offense have discussed and looking to solve it. Near the beginning debate around identity theft relied on subjective proof which is mainly reported by the popular press Identity theft is in many ways a more harmful act that can have continuous effects on major financial effect on merchants as well as on customers.Recent studies have found that identity theft victims often suffer the same emotional consequences as victims of other crimes. The crime of identity theft can be difficult to track because it takes many forms and is used to further other crimes, such as credit card fraud, immigration fraud, Internet scams, and terrorism.Identity fraud arises when someone takes ov er fictitious name or adopts the name of another person with or without their consent Rt Hon David Blunkett MP (2002)DIRECT LOSSESDirect losses can be defined as losses in terms of monetary value. Reflection of such costs can be seen as incorporated costs of the market incentives faced by such parties addressing the issue. Surveys conducted by experts show the range of financial losses that the businesses have suffered. Identity theft losses to companies are over two times greater whereas to consumers three times that are linked with conventional payment deception. Analysis of recent consumer surveys has suggested that while users may view the internet as a marketing channel set for its convenience and ease of use for shopping, security and privacy issues are very influential on decisions to buy online. (Smith and Rupp, 2002a, b)In e-businesses associated fraud losses are also normally charged back to merchants. From the perspective of the credit card issuer, the cost of identity t heft for illegally purchased products is most likely to be claimed against the applicable retailers by the credit card issuer. Internet merchants fraud-related costs are high, and when those costs are combined with growing consumer fears of identity theft it results in significant damage to the business. For consumers, the main impact of identity theft is the unauthorized use of their credit card accounts that could make them suffer financial losses. Corporate identity theft provides perpetrators to conduct industrial sabotage resulting in possible fines to businesses for breach of regulatory rules.Another form of direct losses is the loss of data, according to studies data breaches cost companies losses in terms of administrative performance, management defections and loss of critical and sensitive business data as well as customer data. It will also drop by the wayside consumers to sue if their personal information is improperly taken from online transactions (Tillman, 2002). It also results in cost overheads for companies to implement preventive measures and techniques. Additionally there will be costs for the recovery of loss-data. It also impacts the company to continue its business processes, above all companies may go out of business because of major data-loss.One more category of direct loss is the loss of equipments and products, since it is very easy for id theft criminal to divert the delivery or shipment of goods by having unauthorized access to the place where it is convenient to pick it up.INDIRECT LOSSESThere could be many indirect losses because of identity theft. For example, the time and resources spent on disciplinal action after the identities and personal information have compromised. However, the ultimate indirect loss, in this regard is, the loss of goodwill, company reputation, customer confidence and relationship with trading partners. Reputation is one of trustworthy behaviour and plays an important part in determining the willingne ss of others to enter into an exchange with a given actor (Grabner-Kraeuter, 2002, p. 48).It has also estimated that businesses fear to accept large number of orders because of their susceptibility, especially they turn away overseas transactions and hence get to lose business. The combination of financial losses join with reputation and customer trust provide great level of damage to the e-businesses. In terms of reputation, it can said that any e-commerce scandal will become headline of news immediately and the media is always curious about such scandals, thus the publicity of any such incident ruins the company reputation largely.Consumers always worry about their privacy. Many researchers have found that, a majority of internet users worry about spreading of personal data, because the person stealing someones data can use it to misuse the bank accounts, conduct a crime using the details of somebody else, can easily get away from worst situations or can even cross countries bord ers using fake identities, all of the above can create problem for the person whose identity has been used for all such crimes.Liability issues are always in concern when companies are dealing with trading partners or doing the business within a country having stiff laws for companies to be found liable if they do not protect their own and critical information of others. Theft of corporate identities may adversely affect team spirit of third party employees as well as the competitive advantages that a company may have with its trading partners. Using a network perspective, concerning interrelationships between people and organizations, economic relationships between organizations embedded in networks of social relationships (Galaskiewicz, 1985 Granovetter, 1985 Uzzi, 1997).Improper handling of information can also take companies to court where they can held accountable for negligence and can face severe fines including imprisonments. Another aspect of indirect loss is the damage t o the credit history of both customers and businesses. Businesses will no eternal be able to obtain business loans to boost their business and also cannot obtain insurance benefits from insurance companies. Similar things happens to customers, once their history has been marked liable(predicate) they cannot obtain bank loans, credit cards, health claims and even a better carrier.In summary, the above psychoanalysis shows a picture what an individual or a business might suffer from if cyber criminals steal their identities.E-commerce and Main CategoriesNowadays businesses are using heterogeneous computer environments to integrate their proprietary systems with the external world. Database servers and application servers back up with middleware to interface with online connections these include HR management, supply chain management and customer relationship management.Through electronic networks where the purpose is to achieve businesses, E-Commerce can be disconnected into major categoriesBusiness-to-Business (B-TO-B) relationshipBusiness-to-Customer (B-TO-C) relationshipBusiness-to-Government (B-TO-G) relationshipConsumer-to-Consumer (C-TO-C) relationshipMobile Commerce (m-commerce) relationshipThe two core categories are Business to Business and Business to Customer.Business to Customer (B-TO-C)B-TO-C e-commerce is a part of the business, which deals with commercial activities between companies and customers. Companies can easily make their strategies according to the needs and requirements of customers, based on analysis of customers statistics in this model, these statistics can be based on marketing, sales and customer service components (e.g. ordering, online assisting, delivering and customers interaction etc.).E-tailingThe most common form of business-to-consumer (B2C) transaction is E-tailing. (Electronic retailing) It is the selling of sellable merchandise over the Internet.E-Tailing Revolutionary Trends in E-BusinessRecent studies have found tha t 1997 was the first big year for e-tailing. Dell Computers claimed as they processed a multimillion dollar orders taken through their Web site. In 1996, was the success for Amazon.com welcomed Noble Barnes to launch itsE-business site whereas, Commerce Net/Nielsen Media disclosed that 10 million customers had completed purchases on-line.A systematic approach in this regard, needs a good combination of business strategies and dynamic networks. The total of these structures is called a dynamic strategic network (Dyke, 1998). One of the best examples of B-to-C e-commerce is Amazon.com, an online bookshop that launched its site in 1995. The benefits of B-TO-C e-commerce includes that it provides instantaneous communication between consumer and trader as well as products and services can be access globally and transactions happens in real time, whereas the risk includes, the confidentiality and privacy of customers information.Business-to-business (B2B) and business-to-customer (B2C) t ransactions are used in e-commerce and is a type of online shopping.Advantages of B2C e-commerceThe subsequent advantages areShopping can be quicker and expedient.Prices and Offers can alter immediately.The website can be incorporated with Call centers directly.The buying experience will be improved by Broadband communications. scene of E-ShoppingE-Shopping was in