n the first major identity theft scare this year, Alpharetta, Ga.-based ChoicePoint Inc., a collector and seller of consumer data, announced on Feb. 15, 2005 that criminals gained access to the personal information of nearly 145,000 consumers in all 50 states.

Thieves used stolen identities to create what appeared to be real business licenses of check cashing companies or debt collection firms in order to breach ChoicePoint's security system. The crooks then opened at least 50 accounts with ChoicePoint to access the consumer records, which included information such as names, addresses, Social Security numbers and credit reports.

The company said it first learned of the breach in October 2004, but did not notify potential victims. On Feb. 21, the company released a state-by-state breakdown of how many people it thinks might have been affected.

Under pressure from attorneys general in 38 states to alert consumers, the company also mailed warning notices to affected residents in all 50 states, the District of Columbia, and three U.S. territories. California received the most notices (34,114), followed by Florida (10,216), New York (9,370) and North Carolina (6,983).

California officials said that as many as 500,000 people might have been affected, but ChoicePoint disagrees with that number.

The company has hired a retired Secret Service agent to refine its business-verification process, the Associated Press reported. As part of the reform, ChoicePoint will reissue credentials to any business that is not publicly traded or a government agency. This process will involve about 17,000 companies.

Between the announcement and press time, ChoicePoint shares dropped more than 10%.

ChoicePoint said it will pay for a one-year subscription to an agency that monitors credit for each person that it believes the breach might have harmed.

ChoicePoint, founded in 1997, is a spin-off of credit reporting firm Equifax. The company stores 19 billion records in its database and reported more than $900 million in annual revenue last year.