The analysis of fraud trends during 2006 by Cifas - the UK's Fraud Prevention Service - reveals a number of key points.
Identity theft cloud has a silver lining
Although the number of victims of impersonation was up by 19.91% (at 67,406) when compared with 2005, and the number of attempted identity frauds identified by CIFAS Members was up by 21.57%, the situation is in fact much better than these statistics imply. This is because the rise in the number of attempted ID frauds detected by CIFAS Members before an account was opened increased during 2006 by almost 40%. This means that a higher proportion of the victims whose identities had been compromised never reached the stage of having money stolen from their accounts, or having products taken out in their name.
The top three false or stolen documents used by fraudsters to attempt identity fraud in 2006 were: utility bills, then passports, and then bank statements.
Attempted fraud hits record levels
While the growth in attempted identity frauds increased by 21.57%, attempts to commit fraud by including lies in application forms (eg for finance, insurance or other products) also increased, but less steeply (by 8.19%). While both of these figures represent record levels of attempted fraud, this trend would be far more worrying if CIFAS Members' early detection rates had not also increased.
Sharing data on frauds prevents huge financial losses
CIFAS's 250 Member organisations share data on identified frauds in the fight to prevent further fraud and, by doing so, avoided losses during 2006 totalling more than £789,816,000. This figure represents an increase year on year of 15.89%. This means that fraudsters were frustrated in their attempts to steal £90,162 an hour during 2006, up from £77,802 in 2005.
Sharp increase in Facility Takeover Fraud
The volume of facility takeover fraud is low when compared with identity fraud and application fraud. Nonetheless, the 63.4% increase in this kind of fraud experienced by CIFAS Members during 2006 is noteworthy. It is difficult to pinpoint the cause of this, but coulddd be attributable in part to the rise seen in online 'phishing'. (Phishing is the use of 'spoof' emails and websites that are designed to deceive recipients into divulging personal financial data (e.g. credit card numbers, account numbers, user names, passwords, etc.) to facilitate identity fraud).