Editorial

Identity fraud on the rise

COVID-19 creating new opportunities for criminals to steal money and information, says UK fraud prevention service, Cifas

Posted 12 August 2020 by

Identity fraud rose by nearly 20 percent in 2019, according to new research from UK fraud prevention service, Cifas.

2019 saw the highest ever number of cases of fraudulent conduct recorded to the National Fraud Database. Facility takeover also reached its highest level in 2019 – up 105 percent over the past five years. It now accounts for nearly one in 10 of all cases.

“The steady increase in fraudulent conduct over the last few years provides us with a stark warning that we must start taking this threat seriously,” said Nick Downing, chief intelligence officer for Cifas.

“We all need to take a step back and consider how we can change our behaviours. Businesses must look to how they can better safeguard their systems and protect their customer’s data, and individuals need to be constantly vigilant of fraudsters trying to steal their personal and financial information.”

Technology’s role

Technology played a key role in facilitating fraudulent conduct, with 87 percent of identity fraud in 2019 occurring through online channels. Details are mostly obtained through smishing and phishing attacks, where victims are tricked into giving personal and financial information believing they were contacted by legitimate organisations.

Spoofing of websites of well-known brands was also a key theme over the year, where a website is made to look like a known service provider to obtain personal details.

People aged over 31 were specifically targeted by this type of fraudulent conduct, with victims aged 60 and over on the rise. The highest number of victims (68 percent) were recorded in the South East region.

The London region recorded 31 percent of all cases – twice the rate of the rest of the UK. This was followed by the West Midlands, the Eastern region and the North West regions.

“We know that the COVID pandemic created new opportunities for criminals to steal money and information, and my concern is that the current economic uncertainty will fuel fraudulent activity even further, said Downing.

“If we don’t take action now, then without doubt, the high levels of fraudulent conduct we are currently seeing will just be the tip of the iceberg when compared to the coming year.”

Digital transformation

There is light at the end of the tunnel, notes Keith McGill, head of fraud & ID at Equifax UK.

“The pandemic has forced businesses to accelerate their online presence and digital transformation. Many are using this as an opportunity to embrace the latest technologies, and for those without legacy systems they are able to introduce cutting-edge services and security from the outset,” he said.

“Consumer confidence, coupled with more effective digital identification and security measures, will ultimately benefit the reputation and longer-term strength of companies committed to making the change. For those who are slow to react, COVID-19 is likely to speed up their decline as the world moves to a digital future.”