Identity Thieves Get Online

(CBS)  Identity theft has become an epidemic, with thieves surfing the Internet for public records and rifling through the garbage for names, records and receipts.

CBS News Correspondent Jerry Bowen reports an estimated 750,000 victims a year are affected by the crime.

The practice is as common in the newspaper police blotter now as old fashioned burglary, and no one is immune. Ben and Tracy Bales' 16-month-old son Tyler's identity was stolen after the boy died.

Ben explains someone claimed Tyler as a dependent to get a $1,500 tax credit. The Baleses learned of the fraud only when the Internal Revenue Service rejected their tax return.

It angers Ben that the Salem, Ore. couple had to bring a death certificate and other documents to the IRS as proof when, "The person that stole his identity didn't have to prove anything. But we had to prove that he was our child."

The Baleses believe the thief got Tyler's information from a genealogy Web site, where he is still listed. Ironically, they still don't know who the person is, because the IRS protects the thief's identity.

And then there's the story of Seattle resident Dawn Whitaker. Identity theft made her life a living hell. "I lost my life," she says. "I lost who I am because somebody else became me."

As she has worked through piles of paperwork trying to clear her credit record, so far the thief has rung up about $5,000 in fraudulent checks and credit card charges.

Along the way Whitaker made an amazing find: there was video from a record store of the person using her stolen credit card, twice in 20 minutes.

But without a name for the face caught on tape, she says the police won't even look at it. "If I knew a name, we wouldn't be going through all this," she explains.

Identity theft is a low priority for many police departments, and that's a big advantage for identity thief Stephen Massey. Though he is now in federal prison, he maintains, "it's something you don't have to be a rocket scientist to do."

Massey ran up $400,000 in fraudulent credit card charges on the stolen identities of 800 victims. He says he got help from the credit card companies.

He sees Web sites that allow you to apply for and receive credit card accounts online as "free money." "It's better than robbing a bank," he says. "But you're robbing a bank."