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February 3, 2004.

JAMIE GARAY, Plaintiff, -against- U.S. BANCORP, Defendant

The opinion of the court was delivered by: ARTHUR SPATT, District Judge


On July 15, 2002, Jamie Garay, ("Garay" or the "plaintiff") commenced this action against U.S. Bancorp (the "defendant"), asserting seven causes of action, three claims relying on criminal violations and four state common law claims: (1) aiding and abetting identity theft; (2) aiding and abetting mail fraud; (3) obstructing justice; (4) gross negligence; (5) failure to provide due diligence; (6) aiding and abetting in a conspiracy to commit conversion; and (7) Page 2 invasion of privacy. Pending before the Court is the defendant's motion for summary judgment dismissing the complaint on the ground that the three claims asserting criminal violations do not afford a private right of action. In addition, the defendant asserts that there is no legal basis to support the plaintiff's four state common law claims.


  The following facts are undisputed unless otherwise indicated. In 2001, an imposter stole Garay's identification information, including her name, date of birth, social security number, and address. Based on the stolen information, the imposter applied for a credit card from U.S. Bank National Association ND ("U.S. Bank"), a subsidiary of U.S. Bancorp.

  In that same year, U.S. Bank received, via the internet, an application for a WorldPerks Visa business credit card from a company called the Ultimate Roots Inc. The application was transferred to a U.S. Bank data entry form. The defendant explains that, upon receipt of a business credit card application, it was U.S. Bank's standard procedure to attempt to verify certain information associated with the business listed on the application, including the owner and the address of the business, by consulting a Dun & Bradstreet Report. The defendant contends that no Dun & Bradstreet Report existed for Ultimate Roots Inc.

  According to the defendant, to determine whether to issue a credit card pursuant to Page 3 a business card application, U.S. Bank's underwriting practices focused on the verification of certain information relating to the authorizing officer indicated in the application because business cards function very similarly to consumer credit cards. The authorizing officer was identified as the plaintiff. The application also listed: (a) 16 Hallock Meadow Drive, Stonybrook, New York as the authorizing officer's address; (b) October 13, 1958 as the authorizing officer's date of birth; and (c) the authorizing officer with Garay's social security number. Because the computer program U.S. Bank used at that time to initially process internet-based credit card applications deleted leading zeros from the social security number, the leading zero in the authorizing officer's social security did not appear on the application. Nevertheless, U.S. Bank received a nine digit social security number for the authorizing officer and used the entire nine digit number to process the application.

  The defendant further contends that, to verify the information relating to the authorizing officer listed on the application, U.S. Bank obtained an electronic copy of an Equifax Consumer Credit Report in the name of "Jamie Garay." By comparing the information listed on the application with the information listed in the Equifax Consumer Credit Report, U.S. Bank verified the information relating to the authorizing officer, which included the authorizing officer's name, address, date of birth and social security number. U.S. Bank also reviewed the credit history of the authorizing officer contained in the Equifax Page 4 Consumer Credit Report. In sum, the defendant contends that it followed all the regular procedures to investigate a new account.

  In response, the plaintiff contends that neither U.S. Bank nor U.S. Bankcorp ever tried to obtain a Dun & Bradstreet report about Ultimate Roots Inc. In addition, the plaintiff disputes the defendant's assertion that the name "Jamie Garay" was linked to the authorizing officer. The plaintiff further contends that the defendant failed to verify the address, date of birth, and social security number of the authorizing officer.

  On an unspecified date, U.S. Bank issued a WorldPerks Visa business credit card with a credit limit in the amount of $20,000 to the imposter in the name of "Jamie Garay" for Ultimate Roots Inc. Sixteen transactions were executed with use of the credit card, totaling in the amount of $20,098.05. On or about March 19, 2001, the account became delinquent.

  On or about July 24, 2001, the plaintiff informed U.S. Bank that she did not open the account and that the account was fraudulent. Soon thereafter, U.S. Bank opened an internal fraud case to investigate the facts and circumstances surrounding the application for and use of the credit card. U.S. Bank reversed all of the charges associated with the account, including the purchase charges, finance charges, late payment fees and over-the-limit fees, causing U.S. Bank to absorb the loss of more than a sum of $20,000. Pursuant to Page 5 its policy, if an account is delinquent for more than 150 days, the defendant reports it to a credit reporting agency. However, because the account here was less than 150 days past due, U.S. Bank never reported any delinquency to any credit reporting agency.

  Sometime after July 24, 2001, Garay contacted U.S. Bank seeking documents related to the account. Soon thereafter, at the plaintiff's request, U.S. Bank sent to her eight account statements.

  On or about August 2, 2003, the defendant issued a credit card to her home address but failed to follow the fraud alert on her credit file to personally contact her at a specific telephone number before issuing a credit card. The plaintiff contends that the defendant's failure to follow the fraud alert is further evidence that the it fails to follow procedures to investigate a new account.


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