FinTechCyber Security & FraudReport: UK Organisations Must Do More to Stop Identity Fraud

Report: UK Organisations Must Do More to Stop Identity Fraud

Data driven identity crimes – frauds carried out using a victim’s identity details to obtain new accounts or take over existing ones – accounted for over 45% of all the confirmed frauds identified in the first three quarters of 2014, according to new data by Cifas. These figures continue the pattern seen in recent years, underlining the severity of the challenge facing consumers and businesses equally.

While identity fraud existed before the proliferation of online services, use by online crooks of data such as passwords and emails, or personal data harvested through hacking attacks and social engineering, can now be considered the ‘norm’ in terms of fraud. The 45% figure may represent a small decrease from some of the proportions recorded in previous years, but identity crimes represent as strong a challenge as ever to the financial wellbeing of organisations and consumers.

“For the modern fraudster, knowing somebody’s personal or financial details is a licence to print money and the continuing preponderance of such data driven financial crime must serve as a warning,” said Richard Hurley, communications manager for Cifas. “Defeating it means we have to demand that organisations do more to handle our data securely, and ramp up their fraud prevention efforts. Individually, however, we also have a responsibility to look after our own details. Without doing so, we are effectively handing access to our bank accounts to a complete stranger.”

Since 2010, there have consistently been over 100,000 instances of victimisation each year. The figures for 2014 to date indicate that this year will repeat the pattern, with almost 90,000 victims of identity crime identified by the organisations that use the Cifas National Fraud Database already.

While fraud may never be eliminated, figures such as these – and the patterns of recent years – prove that UK businesses must become more aggressive in their approach to fraud prevention. “While many organisations have put into place robust and comprehensive strategies to combat online crooks, and have empowered their customers to do the same, that does not mean all organisations have done so,” said Cifas Chief Executive Simon Dukes. “Every organisation and person must now, surely, recognise that if they do not co-operate with others in terms of identifying and implementing good practice, data sharing and responsible online behaviour then they instantly become the weakest link in the chain. This means that they encourage fraudsters to continue their crimes, damaging us individually and collectively.”

Following the release of Cifas’ stats, Brian Kinch, senior partner working with FICO’s global fraud clients provided three tips to avoid becoming a victim if identity fraud:

  1. Take precautions. Use and keep anti-malware up to date. Adopt latest security measures offered by your bank.
  2. Be vigilant. If you receive a call or an e-mail that comes from an unknown or unexpected source, or presents itself in an odd format, be sceptical.
  3. Protect your credentials. The only one that should know all of your authentication and payment security details is you. If anyone asks for full credentials or passwords, for whatever reason, do not provide it.

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