Personal Finance

The Threat of Fraudulent Driver's Licenses—And What's Being Done To Remedy It

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Thousands of fraudulent drivers licenses are in use in America today. While some have been shipped into the country from overseas, others have been issued at legitimate DMVs. While these fraudulent licenses represent just a small portion of the overall number of licensed drivers, they pose a number of risks to everyday individuals, ranging from identity theft to accidents caused by reckless drivers with revoked licenses.

Earlier this month, a Maryland-state legislative audit revealed that up to 826 driver's licenses were issued to individuals with fraudulent identification documents. Many of these individuals, presumed to be in the country without the documentation necessary to legally apply for a license, used false or duplicate information, such as a repeated comptroller number, to take out multiple licenses. Other drivers received renewed licenses despite having up to 12 points accrued on their driving record due to past traffic violations. Processes are set in place to prevent these individuals from receiving licenses, but auditors found the process was not being enforced across all applications. While the employees responsible for these oversights have been dismissed, the fraudulent licenses could not be recovered, since the applicants registered them under fake addresses.

Unfortunately, this kind of fraud is not limited to Maryland. One New Jersey man, who'd had his license suspended 64 times—including six DUIs—was caught using fake identities to take out not one but two licenses to drive commercial trucks.

And in May, the U.S. Customs and Border Protection discovered 58 fraudulent state driver's licenses in one day at Washington Dulles International Airport. The licenses were shipped from China, and were addressed to individuals in four different states (FL, VA, GA, NJ) and Washington D.C. Additionally, the licenses themselves were fraudulently registered under six different states (NJ, NY, PA, RI, TN, WV). Homeland Security and State Motor Vehicles Agencies have played a frustrating game of cat-and-mouse with Chinese companies for years, as these unregulated companies have learned to create ever more sophisticated fraudulent licenses.

What Risks Do Fraudulent Driver's Licenses Pose?

While such licenses represent only a small number of overall drivers, these fake licenses pose a number of risks. Often, fraudulent licenses include a real driver's data. If an individual obtains a fake license with your information on it, they could use that ID to cash checks in your name, and even to open a bank account. Additionally, you could end up carrying the punishment for any driving infractions they commit. According to the Florida Department of Highway Safety & Motor Vehicles (DHSMV), if someone used your identity on a fraudulent license, and they receive a driving citation, the resulting license suspension might apply to your valid driver's license. The DHSMV won't be able to remove that citation without authorization from the court that ordered the conviction, which, at best, spells a heap of paperwork and wasted hours for you. And ironically, according to New York Governor Andrew Cuomo, individuals who attempt to purchase fake licenses are often themselves the targets of identity theft. Cuomo has waged a war on fraudulent licenses as well as underaged drinking, for the past several years.

Another risk is the danger unofficially licensed and uninsured drivers pose to you on the road. The most common and widely known use for fake licenses is to enable underage drinkers to purchase alcohol. That reality is problematic in its own right, but if those teens then get behind the wheel, that implies greater risk to all drivers. Also, individuals with severe enough traffic violations, such as a DUI, are prime suspects for purchasing fraudulent licenses. If these drivers continue to drive recklessly under a fake license, and especially if they don't carry sufficient auto insurance, you could be left on the hook for car repairs or medical bills they cause in an accident, if you don't have uninsured motorist coverage.

Luckily, 39 states now employ software to identify attempts to register fraudulent driver's licenses. Since fake licenses have become extremely sophisticated, government software won't eliminate fake licenses and IDs altogether. However, these measures are allowing states to make gains in shutting down attempts to use fake licenses. Additionally, you can help protect yourself by regularly checking your own information. Review your driving record and credit report annually to see if they've been wrongfully issued a driving citation, or if you see a line of credit you don't recall opening. Finally, always make sure you have adequate car insurance to cover you in case of an accident.

This content originally appeared on ValuePenguin.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.