Fraud reaches new record high

by John Fitzsimons on 03 February 2012  |  9 comments
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Fraud figures jumped 9% in 2011, with identity fraud one of the main culprits. So how do you protect yourself?

2011 was a bumper year for fraudsters. According to the latest figures from the UK’s fraud prevention service, CIFAS, over 236,500 frauds were identified by members across the year, the highest ever.

That’s a jump of 9% year-on-year. And it’s ordinary individuals that are suffering as a result – there were more than 120,000 individual cases with an identifiable victim.

Let’s take a look at the biggest fraud risers, and how to combat them.

Identity theft

For fraudsters, getting hold of someone’s personal data is manna from heaven. Almost half of all frauds identified last year involved the impersonation of another person, or the use of completely false identities.

Indeed, identity fraud continues to be a dominant form of fraud, accounting for almost half of all frauds in 2011. In fact, the number of identity fraud cases jumped by a whopping 10% last year.

As the name suggests, identify fraud is where a thief takes over your identity in order to sign up for credit or purchase goods or services. They get to enjoy those purchases, but you’re the one that is charged for them!

Your identity could be stolen in all sorts of different ways. Maybe fraudsters got hold of your personal details due to you being a little complacent when disposing of official documents. Or maybe you responded to a phishing email.

For a guide to some of the ways fraudsters may utilise to pilfer your identity, check out Seven sneaky identity theft tricks.

Getting hold of your identity is just the start though, and can lead to further forms of fraud.

Application fraud

Application fraud for example accounted for 43,263 cases reported by CIFAS members last year. This is where fraudsters open an account in someone else’s name, using fake or stolen documents.

It spans everything from a monthly mobile phone contract to a mortgage.

Facility takeover

Also known as account takeover, this is where the fraudsters pose as the actual customer and assume control of a legitimate account. This could be your credit card account, bank account, email or even something like your account with your broadband provider.

Once they have assumed control, they then make fraudulent transactions. According to Action Fraud, online accounts that are taken over in this way are usually down to the victims being caught out by phishing, spyware or malware scams.

Protecting your identity

There are some very simple steps you can take to ensure that your identity is as safe as possible.

1) Be vigilant with documents with your personal details on

My wife is a passionate shredder. Anything that we don’t need to keep for your own records gets shredded and recycled. Don’t just chuck yours in the bin!

2)  Check your statements carefully

If anything untoward appears on your statement, make sure you report it to your bank. If you have been caught out by a fraudster, acting quickly will save you a lot of bother!

3) Don’t trust unsolicited calls or emails

Your bank will NEVER email you with a link, asking you to follow it and then fill in your personal details. Similarly, if you receive a phone call out of the blue from someone claiming to be your bank, be on your guard. With phonecalls, if you are concerned, simply hang up and then ring your bank directly.

4) If you move house, make sure your post is redirected

Also, if your post is delivered to a communal area, make sure it is as secure as possible. See if you can get a lockable postbox, for example.

5) Keep on top of your credit record

If you monitor your credit record regularly, you’ll know if anyone attempts to open a new account or take out credit in your name. You can get a free trial with Experian courtesy of lovemoney.com.

Misuse of facility

The last form of fraud that I’m going to look at is somewhat different to identity-related frauds.

Misuse of facility is a growing problem, with a whopping 53,996 cases across 2011.

In the words of CIFAS, this is ‘one of the most disconcerting fraud types’. In this form of fraud, the account is opened completely legitimately. However, while the account is above board, it’s used for things that certainly aren’t, such as receiving stolen funds. Indeed CIFAS believes a substantial proportion of these misuse of facility frauds are carried out by ‘money mules’ – potentially innocent people recruited by the fraudster, so that the crook can use their account to launder money.

So there are now three ways that these criminals can attack your identities. They can impersonate you, hijack your accounts, or even trick you into using your details as a shield for their dodgy antics!

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