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Gary Wright

Gary Wright

Gary Wright - BISS Research

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Is There A Solution To Identity Theft?

23 October 2008  |  6519 views  |  2

Hardly a day goes by before a new story hits the headlines about another fraud. No one it seems is immune from the French president to the man in the street, small businesses to large corporations, there is no safe haven, with all protective measures apparently inadequate to reduce this rising crime. Latest crime figures have shown that the identity theft basis for fraud is the fastest growing crime in the UK and this trend is keeping pace with global figures.

What can be done? Individually we have been told to shred paper with personal information but this is still not preventing the rise of identity theft. ‘Know your customer’ requirements have been beefed up by various European Directives meaning there is a massive increase in personal information kept on an electronic file somewhere. We all know about the catalogue of missing disks from government agencies but how many more are lost but unreported?

Web purchasing has been increasing year on year and normally entails completion of personal details to authorise the purchase. This is dead easy to hack into!

More on-line subscriptions increase the likelihood of losing control of your identity. More and more personal details are given up by more and more people to any number of government or commercial organisations. The list is endless of where personal details are kept on file and there is going to be even more personal details being bandied around the world, as mobile purchasing and the use of technology to make our lives easier increases our personal risk.

The identity card scheme that the government has tried to get passed in Parliament can either be seen as a reduction of personal identity risk or another method of increasing it?

Technology can be the saviour but also be the very thing that is increasing our risks. You will note that identity theft was not a huge issue twenty years ago but has sufficed as the web and various institutions capture more of our data.

So what’s the answer? We certainly can’t put the genie back in the bottle, so we are left to create a more solid barrier against criminal activity. This has to be a combination of legal protection for the individual, as well as more individual responsibility but with tough penalties against governments and commercial businesses that do not have robust and maintained security measures of the data. This brings the argument back to technology.

There is some terrific technology in the market place, which can be used to combat the criminal and companies like Thales who are experts in the field of security who can offer advice and systems. However, there must be a necessity to align the technology properly within the correct environment. Therefore we probably need to finally visit the issue of identity cards. IdenTrust are one of the organisations that have been pushing for standards in the identity of corporates, financial services firms, funds, accounts and individuals for sometime. They almost have a mandate based on the SEPA and MiFID directives to establish a global identity framework.

This crime is on the increase and it’s now time to pull together all the various organisations that have some role in creating an effective barrier. Who could drive this initiative?

It’s a mixture of political and legal issues; with financial services just one of the worlds industries that needs to buy in. The driver has to be from a legal standpoint, which will in turn, lead to passing new directives and laws that will create the energy for implementing system solutions.

It looks daunting but not impossible!     


Comments: (3)

A Finextra member
A Finextra member | 24 October, 2008, 10:34

There are many identity-related products around since quite a few years, such as tokens or smart cards. They do work fine, but for various reasons they failed to gain significant market share - mostly due to cost or difficulties in using or managing those. Who wants to carry five different cards or tokens for different purposes, and where is the slot to put that smart card in when you use another PC than the one you have at home ?

Callback schemes involving mobile phones seem to be a secure and more convenient approach, and there are related software products available. But apparently the pain is not big enough yet to trigger the big breakthrough ...


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A Finextra member
A Finextra member | 24 October, 2008, 11:16

Thanks for your comment Gerhard

I agree there are possible system solutions but feel that they need governments to establish a cyber crime initiative to create new laws that force implementation. The police are fighting a losing battle at the moment and need more support.

I am not sure how much worse things have to get before this crime is dealt with 

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A Finextra member
A Finextra member | 25 October, 2008, 12:14

As we return to a cycle of greater cost sensitivity and competition, the desire for geater trust will drive identity management and it will most likely follow the path of least resistance and lower costs, mobile.

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job title Analyst
location London
member since 2007
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CEO of B.I.S.S. Research, founder of the BISS Independent Accreditation for all systems and services provided to financial services companies internationally. Guest Lecturer at Reading University and...

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