Two Nigerian-born fraud artists were arrested in Los Angeles in 2002 by federal officials who charged that the pair used ChoicePoint to gain access to confidential information about at least 7,000 people and possibly many more, resulting in at least $1 million in losses.
The most recent incident came to light because of a new California law that requires credit agencies to notify victims of identity theft.
ChoicePoint executives on Tuesday declined to comment.
Consumer advocates said they were outraged.
ChoicePoint "tried to suggest there really wasn't a problem" after the recent case became public, said Marc Rotenberg, executive director of the Electronic Privacy Information Center. "This makes it clear they had been aware of earlier problems with the wrongful sale of their information to criminals."
Consumers Union attorney Gail Hillebrand, who was attending a state meeting on identity theft convened Tuesday by Gov. Arnold Schwarzenegger, called the earlier case an "illustration that you can't rely on companies with a business incentive to distribute information to restrict that access."
ChoicePoint records, which can include credit reports, addresses and Social Security numbers, are invaluable to identity thieves, who use the information to open fraudulent accounts.
The recent ChoicePoint case came to light because Atlanta-based ChoicePoint was forced to notify 35,000 Californians — in accordance with the law — that their records might have been compromised.
After angry officials nationwide called for wider disclosure, the company sent notifications to an additional 110,000 people. Senate Judiciary Committee Chairman Arlen Specter (R-Pa.) said he would hold hearings on identity theft.
California Sen. Dianne Feinstein (D-Calif.) said Tuesday that the discovery of the previous case gave ammunition to proponents — including her — of a national disclosure law.
"Clearly ChoicePoint had been violated once before," Feinstein said. "In the most recent case, if it weren't for the California law, I don't believe they would have done anything about it."
In both California cases, the people convicted of the crimes were illegal immigrants of Nigerian descent living in the San Fernando Valley. They used multiple fake identities to establish accounts with ChoicePoint, allowing them to comb through database records for personal data. Authorities say they don't know if there is any link between the perpetrators in the two cases.
"I think the people in this area of crime know that ChoicePoint and companies like them are a great resource for theft," said Assistant U.S. Atty. Mark Krause, who prosecuted the earlier case.
Pleading guilty in that case was Bibiana Benson, 39, of Sherman Oaks and her brother, Adedayo Benson, 38, of Encino.
According to court documents, Bibiana Benson admitted to opening a ChoicePoint account in 2000 in the name of Christine Burton and the company C&B Research, showing a real estate broker's license and driver's license for identification.
Both licenses were faked, Krause said. When federal authorities contacted the real Burton, a resident of Indiana, she said she had never opened a ChoicePoint account or heard of C&B Research.
Bibiana Benson obtained personal information — including Social Security numbers and addresses — from the ChoicePoint databases and sold the data for $40 to $65 per name, prosecutors said in court documents.