ID theft levels soar as criminals set their sights on new targets

The UK has a fraud problem and its growing, according to the latest data.

This week, Cifas, the country’s leading fraud prevention service, released new figures combining data from hundreds of organisations that show worrying new trends in financial crime.

Cases of identity theft reached an all-time high in 2017 with almost 175,000 cases recorded. While that’s only up 1 per cent in a year, the number represents a 125 per cent increase in 10 years.

But there has also been a staggering increase in the number of young adults becoming money mules – laundering illegally earned money through a legitimate bank account by transferring it into and out of their legal account in return, usually, for a small amount of cash.

With one in three people open to becoming money mules there was a 27 per cent increase in the number of 14-24 year olds getting involved in this kind of criminal activity in 2017 alone, the Fraudscape report revealed.

The number of British bank accounts identified as being used as “mule” accounts were up 11 per cent overall.

Meanwhile, more than a third of bank account takeover victims – where a fraudster convinces the victim to disclose login and/or account details – were over 60 years old.

But while data sharing among some of the country’s biggest names prevented more than £1.3bn of fraud losses last year, perhaps of greatest concern is the shift towards softer targets by fraudsters looking for new ways to steal money.

The ID theft figures are so high not because fraudsters are using details to apply for a greater number of credit cards and bank accounts, but because they are targeting other sectors such as telecoms, online retail and insurance.

This “retargeting” by identity fraudsters is considered by experts as a shift towards more accessible products, such as mobile phone contracts, online retail accounts, retail credit loans and short-term loans.

Cifas deputy chief executive, Mike Haley says: “As some targets become harder to crack, criminals turn to what they consider are softer targets. Fortunately, many of these sectors such as telecoms and insurance, share their fraud data and are detecting more fraud attempts. As fraudsters see their attempts to obtain these products become more difficult, the question will arise about where they will target next.”

“Fraudsters are always on the move, on the hunt for their next scam, expanding their target pool and focusing on the identities of people young and old,” warns Sarah Lewis, head of ID and fraud UK at Equifax. Information from young people grows in value as earnings rise and people take on more financial products. Accumulating these details now is an investment in the fraud of tomorrow.

“Criminal fraud networks can use this information to generate high quality ID data to sell via the dark web, creating more opportunities for unlawful activity.

“People are unaware of the value and opportunity their basic personal details offer to fraudsters. The depth of personal information available on social media gives fraudsters an expanding pool of data they can easily abuse.

“It’s clear passwords alone are no longer enough,” she adds. “Fraudsters are wise to our thinking when we create a password, making them all too easy to crack. Businesses need to invest in new technology like biometrics and device recognition creating multiple layers of defence.”

“A small reduction in the overall number of detected frauds is welcome but it’s hard to say whether we are beginning to see the turning of the tide,” adds Haley. “The absolute volume of fraud is still frighteningly high and much more still needs to be done to reduce its prevalence, including greater collaboration and sharing of fraud risk data between industry, government, and law enforcement.”

MP Conor Burns, chair of the all-party parliamentary group on financial crime and scamming, which was launched late last year, says: “Fraud is the 21st century volume crime and the issue is not going to go away. With more and more people sharing data, transacting, setting up businesses, dating and chatting online this trend is only going to continue.

“Fraudscape shows how prevalent this crime is and all of us – government, industry, third sector and individuals have a role and responsibility in preventing it.”

Cifas supports the Take Five campaign, which asks consumers to help protect themselves from financial fraud by remembering some simple advice:

1. Never disclose security details, such as your PIN or full password – it’s never right to reveal these details.

2. Don’t assume an email request or caller is genuine – people aren’t always who they say they are.

3. Don’t be rushed – a bank or genuine organisation won’t mind waiting to give you time to stop and think.

4. Listen to your instincts – if something feels wrong then it is usually right to pause and question it.

5. Stay in control – have the confidence to refuse unusual requests for information.