According to the Federal Trade Commission, identity theft was involved in more than 40 percent of the consumer complaints it received last year–double the percentage in 2000–and reports of Social Security number fraud have shot up 500 percent in the past four years. But critics complain that perpetrators are still treated with more leniency than traditional robbers. About a third of those convicted of identity theft in 2001 were not even sent to prison.

While many states have enacted tougher laws targeting identity fraud, lawmakers on Capitol Hill have been slower to respond. Now that could change. When the session kicks off in January, Sen. Dianne Feinstein (D-CA), plans to re-introduce a four-part package of legislation. The proposed laws would bar the sale and display of social security numbers, increase the punishment for identity theft offenders and make it a crime to be in possession of someone else’s ID information with the intent to commit a felony, among other provisions.

NEWSWEEK’s Jennifer Barrett spoke with Feinstein about how Americans can be protected from this growing problem.

NEWSWEEK: How concerned should the average American be about identity theft?

Dianne Feinstein: This case, which affected 30,000 people, illustrates just how easy it is and how few protections there are for the individual, and how long it takes for them to regain their identity. Identity theft is the bank robbery of the new millennium. You don’t have to go into a bank to rob it anymore. You can rob tens of thousands of people without ever coming in touch with them.

How easy is it for someone to steal your identity?

At a hearing, a police officer from Washington D.C. came forward and gave me a phony credit card that he’d gotten in my name. He showed how is easy it was. He’d gotten it that morning. I still have it in my desk. In another case in California, a hospital executive died. In the obituary there was a lot of personal information, like the mother’s maiden name. An identity thief was able to get his Social Security number and used it to steal thousands of dollars from his widow. That’s how easy it is.

We are such an open society that we open our home and our desk records, everything, to the invaders. Medical records are sold so pharmaceutical firms can sell you information about their products. Your bank records, your mortgages, your credit history are all being sold. All of that personal information should not be available for sale.

Do you think identity thieves are adequately punished?

There was a report that one of the men charged in the case this week [Philip Cummings, who provided the credit information on the victims] could get up to 30 years in prison if convicted. But the fact of the matter is that these crimes are very rarely even prosecuted because up until this point, prosecutors have not really taken them seriously.

Why hasn’t identity theft been taken more seriously?

The size of this case–the fact that it was 30,000 people whose credit histories and personal information were downloaded–is what gives this one case critical mass. We’ve put in various bills though, and the banks actually lobby against the bills.

Why?

They don’t want to have the responsibility of having to be concerned about an individual’s privacy. Secondly, they want to be able to make money from the lists they have of creditors; they sell this list publicly.

What kind of punishment would you like to see for identity thieves?

At least five years in prison. The only way that we are going to stop this is if we treat it as a robbery and burglary–which is what it is. Actually, this is much worse than robbing a bank in terms of the amount of money stolen and the number of people affected. And it has an insidious component to it. There are not strict-enough penalties now.

How much success have you had with your proposed bills to fight identity thieves and toughen penalties against them?

We are supported by the consumer interest [groups,] but the bills are lobbied against by banks. We are going to re-introduce our whole portfolio of bills. The Social Security Act would prohibit the sale or display of Social Security numbers and removes it from driver’s licenses, marriage licenses, death certificates, etc. Then the Identity Theft Prevention Act would make it harder for identity thieves to get access to your credit card numbers and take over your credit card account. The Identity Theft Penalty Enhancement Act would increase the penalty for identity theft. The Privacy Act would set a national standard for protection of personal information. There are four different bills we plan to reintroduce in January when the session reconvenes. This package affords the consumer adequate protection.

Do you think that package of bills could have prevented a case like this ID theft ring?

Absolutely. It provides that the various appropriate departments and credit services have to make it impossible for this kind of thing to happen.

Do you think we’ll see a drop in the incidences of identity theft now that there is more attention being paid to the problem?

Actually, I think it is going to go the other way. I think it is going to become a larger and larger percentage of white-collar crime. It is just too easy to do. The cow is out of the barn and we need to pull the cow back in and lock the door.

Is it too late to do that?

No, not yet. These businesses that profit so greatly by the loose environment have to recognize that they have a responsibility too. There may well be some lawsuits by people who have been ripped off that will show businesses they have liability and, hopefully, that will end the behind-the-scenes lobbying against the bills.

How optimistic are you about the prospects of your legislation passing now?

I’m optimistic. I think increasingly people are coming to understand that they need the government to protect them. I would hope people would weigh in with their Congressmen on the importance of doing that.