SAN FRANCISCO -- A new report co-sponsored by the Better Business Bureau turns much of the conventional wisdom about identity theft on its head.

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The study maintains that ID fraud is not worsening, that most identities are stolen by low-tech methods, and that much of the theft is committed by a friend, family member or someone else known by the victim.

Javelin Strategy and Research helped to prepare the report, which found that the number of victims is in decline and that most identity theft begins with a lost or stolen wallet or checkbook.

Javelin founder James Van Dyke said fears about online fraud may be exaggerated.

"Our numbers show that fears about online identity fraud may be out of proportion to the relative risk, causing consumers to ignore the most glaring issues," said Van Dyke. "Indeed, most instances of identity fraud occur through traditional channels and are paper-based, not Internet-based."

The researchers said the Internet offers tremendous help in stopping ID thieves. Consumers who monitor accounts online reduce their losses by 87 percent, on average.

Here's a summary of the study's findings:

• The most frequently reported source of information used to commit fraud was a lost or stolen wallet or checkbook. Computer crimes accounted for just 11.6 percent of all known-cause identity fraud in 2004; and half of these digitally-driven crimes stem from spyware, software the computer user unknowingly installs to make ads pop-up when the consumer is online. Consumers can protect their financial data by using updated spyware, virus and firewall protection software and not responding to bogus "phishing" e-mails that request personal data.
• Among cases where the perpetrator's identity is known, half of all identity fraud is committed by a friend, family member, relative, neighbor or in-home employee -- someone known by the victim.
• A wide variety of metrics confirm that identity fraud problems are not worsening, with the total number of victims in decline.
• The annual dollar volume of identity fraud is highly similar to 2003 figures (adjusted for inflation) at $52.6 billion.
• The number of identity fraud victims dropped from 10.1 million to 9.3 million in 2004 versus 2003.
• The median value of identity fraud crimes remained unchanged at $750; however most identity fraud victims incurred no out-of-pocket costs.
• The average time to resolve an identity fraud crime dropped by 15 percent -- from 33 hours in 2003 to 28 hours in 2004.
• The majority of identity fraud crimes are self-detected. This reinforces the benefits of activity monitoring through electronic review of transactions, statements, and credit reports allowing consumers to check their account activities quickly and efficiently -- without waiting for a paper bill or statement.