Beat this rising fraud threat
Hundreds of thousands of people have been exposed to this fraud this month. Protect yourself now - before it's too late....
Hundreds of thousands of people have been exposed to the threat of identity fraud following a number of significant security breaches in the past month. Hackers targeted the Guardian Jobs website in an incident which saw half a million users told that their personal details may have been compromised in what was described as a "a sophisticated and deliberate hack".
Elsewhere, insurance giant Zurich admitted it lost the personal and financial details of 51,000 customers during what it described as a "routine data transfer". The two incidents are just the latest in a series of security breaches and data bungles that have seen the personal details of millions of people exposed.
It's no wonder then that - despite the introduction of Chip and Pin and increasingly stringent anti-fraud procedures on current accounts - cases of identity theft are on the rise. Figures from fraud watchdog CIFAS show a 33% rise in the number of ID fraud cases reported during the first nine months of the year and an 11% increase in fraudulent activity overall. More than 59,000 criminal acts of impersonation have been recorded so far this year.
But just what can criminals do with our personal data? And what we do to keep our details safe? We take a look.
What's the risk?
Identity fraud and theft are Britain's fastest-growing crimes - in 2008 alone, CIFAS identified and protected over 50,000 victims of identity theft. Identity theft sees fraudsters use the personal details of people without their consent: these details are then used to obtain goods and services in that person's name. Identity fraud sees those details used to obtain goods or services by deception. This usually involves the use of stolen or forged identity documents, such as a passport or driving licence.
The threat is real, yet it's worth remembering that it's still quite difficult for thieves to raid your bank account - even if they have details such as your bank account number, sort code, national insurance number, address or date of birth - as extra layers of security are always needed.
Even so, it pays to be vigilant - fraudsters can still apply for credit and store cards in your name, set up direct debits or make cash withdrawals. They can do this by building up a composite picture of who you are from a variety of easily-accesible sources. Fortunately, there are effective measures you can take to help keep your personal details safe and make sure your cash stays where it belongs - with you.
Guard your bank account
Your first step is to check your bank and credit card statements regularly, preferably every day through online banking. If you notice any suspicious withdrawals or purchases, notify your bank immediately. Fraudulent transactions can occur without your credit card having left your possession - so spotting them promptly can resolve the problem and minimise your losses.
It's also worth checking your credit report regularly - that way, you'll know whether anyone has been applying for credit in your name. Sign up for free 30-day access to credit reference agency Experian here.
Finally, change your various PINs and telephone or internet passwords regularly - particularly if you've used your child's name or date of birth. Thieves don't need much help to correctly guess the more obvious passwords, so don't make their life easy.
Protecting your details has become more important following an increasing number of cases where banks refuse to issue refunds to identity fraud victims, particularly when the original card or correct PIN have been used. Don't let your bank accuse you of being lax and diddle you out of your rightful refund.
Buy a shredder
One vital purchase in the fight against fraud is a shredder. Thieves often rifle through people's bins looking for sensitive documents and can use discarded or stolen utility bills as a way of establishing a false identity. Yet for just the £20 cost of a triple-blade shredder, you can ensure they don't get the chance.
It's wise to monitor your mail in general. If you fail to receive a regular bill or if some of your post goes missing, tell your service provider. Criminals often target communal buildings where mail can be more easily accessed, so if you live in a block of flats or shared house, it's even more important to stay vigilant.
Keep your details private and up to date
One easy way to protect your personal details is to make sure that, when you register to vote, you only appear on the Full Register, not the Edited Register. Councils can sell the Edited Register to anyone they like, and sadly, you're automatically put on this register unless you specifically opt out.
Similarly, make sure you inform your local council, bank and organisations such as your mobile phone provider of any changes of address. This means that, when anyone fraudulently applies for an account under your name and previous address, this will be automatically flagged if that organisation is using electronic authentication.
If you move home, have your mail forwarded to your new address for at least six months.
Stay Safe Online
Avoid shopping online at websites that do not ask for the three- or four-digit security code found on the back of your credit or debit card (or the front in the case of American Express). The code is an extra level of security only contained on your card - so if it's in your possession, you can monitor its use. Also, look for the Verisign padlock in the bottom corner of your browser window - if it's not there, the website may well be bogus. When you can, pay by Paypal, so that the merchant doesn't get to see your payment details.
Finally - and most important of all - avoid responding to (or even opening) emails asking for your personal details or containing an attachment claiming to redirect you to your bank's website. This is most likely what's known as a 'phishing' fraud, which sees criminals attempt to persuade you to input your details into bogus retail websites or one designed to look like your bank's.
Don't bother with ID theft insurance
Above, I've listed all the sensible steps you should take to tackle ID theft. But there's one step you shouldn't take - and that's buying ID theft insurance. Here at lovemoney.com, we think this is a big rip-off. Find out why here.
Visit Q&A to ask a question about identity fraud