Internet Crime Complaint Center Reaches 2 Million Entries
Source: FBI

16 Nov 2010

A milestone entry in cyber crime was reached on November 9, 2010, when the Internet Crime Complaint Center (IC3) logged its 2 millionth consumer complaint alleging online criminal activity.

The IC3, a partnership between the FBI and the National White Collar Crime Center, became operational in May 2000 and received its 1 millionth complaint seven years later, on June 11, 2007. It took half that time to receive the 2 millionth complaint, which illustrates the IC3’s increased visibility and the continued growth of cyber crime.

The IC3 receives, develops, and refers cyber crime complaints to local, state, federal, and international law enforcement agencies. The IC3 gives cyber crime victims a convenient and easy-to-use reporting mechanism that alerts authorities of suspected criminal or civil violations.

Since its inception, the IC3 has referred 757,016 criminal complaints to law enforcement around the globe. The majority of referrals involved fraud in which the complainant incurred a financial loss. The total reported loss from these referrals is approximately $1.7 billion, with a median reported loss of more than $500 per complaint.*

Many complaints involved identity theft, such as loss of personally identifying data, and the unauthorized use of credit cards or bank accounts. The IC3 uses information from the complaints to detect emerging trends and proactively fight consumer victimization through educational efforts with project partners, various publications and the consumer education website, www.lookstoogoodtobetrue.com.

The pesky critters have been around for centuries and were the bane of American society in the 1700s. Their popularity may have waned since then, but bedbugs are back with a vengeance, prompting insurance for business interruption, third-party liability claims, and reputation risks as hotels and even retail stores face infestations of the bloodsucking pests.

New York has the dubious distinction of being a focal point for bedbug problems, with a recent survey revealing that one of every 15 New Yorkers has dealt with an infestation. Throughout the Big Apple, bedbugs have been found in locations ranging from hotels and theaters to high-end retail stores and the public library.

They are becoming a more widespread concern as the number of infestations increases, said Mac D. Nadel, Norwalk, Conn.-based U.S. practice leader for Marsh Inc.'s retail and wholesale food and beverage practice group. The latest reports have put some focus on retailers, which shows it's not only just a hospitality business problem, but a property, real estate and general problem.

New York Mayor Michael Bloomberg's administration reportedly fielded 11,000 complaints about the pests in 2009 compared with just 537 in 2004. As a result, $500,000 has been committed to deal with the infestation.

However, reports have sprung up in Ohio and Los Angeles as well. Bedbugs-which are not known to spread disease but bite and leave itchy red welts-are more of a nuisance than anything else, but the problem they create is being taken seriously.

More importantly, it's no longer just a hospitality industry problem and the battle against bedbugs is expected to continue.

You really have to take the blinders off on this issue because they're starting to get into places that are not normally exposed to bedbugs, said Tracy Knippenburg Gillis, New York-based crisis management practice leader for Marsh Risk Consulting. It makes it more important for retailers, hotels and other commercial businesses to have a process in place to mitigate the spread and to prevent further occurrences.

Most standard commercial property policies either have specific vermin exclusions for infestation or loss due to insects or have other broad contamination exclusions, insurance brokers and insurers said, adding that the policyholder has to prove actual damage of items that were infested if exclusions aren't present in the policy.

David Kroeger, Chicago-based attorney within Jenner & Block L.L.P.'s insurance and reinsurance group, said policyholders should look closely at what the vermin exclusion says and how it categorizes and defines vermin.

I wouldn't give up on the property policy immediately, Kroeger said. Vermin exclusions may not focus on bedbugs, but may focus on insects like termites.

This is important, Kroeger said, because if a store or hotel is forced to shut down due to bedbug infestation and cannot reopen until after fumigation, business interruption coverage could be triggered.

For hotels, loss-of-attraction coverage could be applied for actual losses sustained due to cancellations or the inability to accept bookings for rooms due to murder and suicide, and also may apply to vermin, said Nancy Green, Chicago-based executive vp at Aon Risk Solutions, a division of Aon Corp.

She also said that type of coverage is an extension of a typical property policy and can provide some relief, typically up to $1 million or higher, depending on the limits purchased.

Source: Insurance Information Institute

Driver distractions or inattentive driving play a part in one out of every four motor vehicle crashes. That is more than 1.5 million collisions a year and 4,300 crashes daily, according to the National Highway Traffic Safety Administration. Text messaging, changing radio stations, even turning around to talk to passengers can prove deadly, according to the Insurance Information Institute (I.I.I.).

While cellphones and text messaging cause the most accidents, drivers are also distracted by using PDAs, laptops and navigational aids while driving. Other drivers create a potential hazard because they eat, drink, read, write or groom themselves when their full attention should be on the road in front of them.

“A car is not your living room, office or kitchen. It is a means of getting from one point to another and must be used judiciously,” said Loretta Worters, vice president with the I.I.I. “People can become so absorbed in their conversations or activities that their ability to concentrate on the crucial act of driving is severely impaired, jeopardizing the safety of vehicle occupants and pedestrians.”

In January 2010, the National Safety Council (NSC) released a report estimating that at least 1.6 million crashes (28 percent of all crashes) are caused each year in the U.S. by drivers talking on cellphones (1.4 million crashes) and texting (200,000 crashes). The estimate is based on data of driver cellphone use from the National Highway Traffic Safety Administration and research that quantifies the risks using cellphones and texting while driving.

A July 2009 Virginia Tech Transportation Institute study found that texting while driving is far more dangerous than previously estimated. The collision risk became 23 times higher when motorists were texting while driving.

On July 21, Kentucky's new ban-on-texting-while-driving law goes into effect making it the 30th state, (including the District of Columbia and Guam), to ban texting while driving. Eleven such laws were enacted in 2010 to help stem the growing problem.

The Utah texting while driving law ban, passed in May 2009, is the toughest in the nation. Offenders convicted of causing an accident that injures or kills someone while texting behind the wheel face up to 15 years in prison. The law does not consider a crash caused by a multitasking driver as an accident, but rather as an inherently reckless act, like drunk driving.

In addition, as of June 2010 eight states (California, Connecticut, Maryland, New Jersey, New York, Oregon, Utah and Washington State) plus the District of Columbia, ban the use of hand-held cellphones while driving.

Employers May Be Held Liable

Employers are now concerned that they may be held liable for accidents caused by their employees while driving and conducting work-related conversations on cellphones, according to the I.I.I. Under the doctrine of vicarious responsibility, employers may be held legally accountable for the negligent acts of employees committed in the course of employment. Employers may also be found negligent if they fail to put in place a policy for the safe use of cellphones.

“In response, many companies have established cellphone usage policies,” said Worters. “Some allow employees to conduct business over the phone as long as they pull over to the side of the road or into a parking lot. Others have completely banned the use of all wireless devices in the car.”