Someone calls you telling you they are conducting a survey for a product you use regularly. After a few innocuous questions, they start asking about your social security number or banking information. They may even state that you are eligible for a prize or drawing, but require your credit card information for eligibility reasons. Is this normal? Is it legal?
Collecting information for one reason under the pretext of another is illegal. While pretexting has always been an invasion of privacy (see the Restatement 2d of Torts § 652C) The Gramm-Leach-Bliley Act makes it illegal for anyone to:
1) use false, fictitious or fraudulent statements or documents to get customer information from a financial institution or directly from a customer of a financial institution;
2) use forged, counterfeit, lost, or stolen documents to get customer information from a financial institution or directly from a customer of a financial institution; or
3) ask another person to get someone else’s customer information using false, fictitious or fraudulent statements or using false, fictitious or fraudulent documents or forged, counterfeit, lost, or stolen documents.
Note that you can be liable for a pretexting violation even if you are not collecting the information yourself. If you purchase customer information from a pretexter, you are in violation of the law as well. Under the Federal Trade Commission Act (FTCA) 15 U.S.C. § 45, the Federal Trade Commission also has the authority to intervene and stop any deceptive act or practice affecting commerce.
Unscrupulous companies use information obtained through pretexting to commit identity theft. The most common forms of identify theft include: credit card fraud, communications services fraud, bank fraud and loan fraud. The best defense against pretexting is to make everyone in your company aware of the threat. Do not give out confidential information to people who contact you; any legitimate entity would already have the information they are requesting. Review all of your statements promptly and contact your providers immediately if you identify any irregularities. Dispose of all confidential information properly. A paper shedder is often your best defense against identity theft.
Most importantly, if you purchase consumer information from third parties, make sure you are not purchasing from a pretexter. Which pretexters are often very stealthy about their activities and take extreme measures to avoid getting caught by the authorities, they are often not nearly as cautious when it comes to protecting those who purchase information from them.