In 2003, it was Citibank’s much vaunted funnies that made us all sit up and worry about the perils of identity theft. The funnies got us taking all sorts of precautions, but even we could not have been prepared for this one: today UPS lost personal records of 3.9 million current and former Citibank customers, while these records were in transit. Norman Black, a spokesman for UPS told Reuters that “we sincerely regret that in this case we have not been able to find this package. We did conduct an exhaustive search… will do everything we can to make sure this doesn’t happen again.” No I am not sure about you UPS. Given this dismissive response, I simply would not trust UPS with any important documents. If it had been USPS, I can bet you that it would be making headlines, and UPS flacks would be calling media to point it out. Makes me mad, that this commerical company, which makes a living out of ensuring that packages get to places on time, has such crass reponse. (Bloggers – time to make this an important enought issue.)

On a more serious note, despite the sound and fury around hacking, and phishing and what not, most identity theft happens because of offline problems. Back in February, Bank of America lost computer tapes containing data for some 1.2 million U.S. government employees. A few months ago, Time Warner lost confidential information on most of its employees. ChoicePoint and LexisNexis have also suffered problems.

Reuters reports that “New Jersey authorities are separately investigating and have made several arrests in what they call a scheme to steal records of hundreds of thousands of customers at Bank of America, Wachovia, PNC Financial Services Group and Commerce Bancorp.”

To be honest this is a more serious problem than most of us realize. How do you deal with it? Imagine the productivity lost? You are on the phone trying to make sure all of your information is safe, enrolling in some credit monitoring service and all that stuff. That takes away from your daily work. Maybe it is time for consumers to get together, and sue the big banks and UPS to teach them a lesson. Elliot Spitzer, here is your chance to get some more cheap votes!!