The scam that destroys lives

Identity fraud is on the rise. We look at how fraudsters catch us out, and what you can do to protect yourself.

You know that identity fraud is becoming a serious problem when ITV feels the need to make a drama about it. And while the programme might just be an entertaining way to pass an evening, the fact remains that identity fraud is very real – and it’s getting worse.

Rising numbers

CIFAS, the UK’s fraud prevention service, has carried out research on fraud trends during the first half of 2010, and has found what it described as alarming results regarding identity fraud.

According to the organisation, there has been a 14% jump in identity fraud compared to the same period in 2009, while there has also been a 22% increase in the number of victims of impersonation.

What’s more, CIFAS reckons things are only going to get worse. It argues that with the economy starting to look a bit more positive, there is every reason to suspect that identity thieves will be looking to redouble their efforts to take advantage.

The cost of identity theft

The most obvious way that identity theft affects victims is financially.

Fraudsters can use your details to open bank accounts, take out credit cards, loans and state benefits, to order goods and services in your name, take over your existing accounts, and even obtain genuine documents such as driving licences or passport.

Estimates vary on just how much identity fraud costs the economy each year, but it is generally accepted to be in the range of £1.2bn to £1.7bn. That’s an awful lot of money.

However, just as significant is the human cost.

It’s no wonder that many identity theft victims end up feeling helpless, vulnerable and unable to trust those around them. If you’d had your identity abused in this way, lost a considerable sum of money and then had to spend the time and effort necessary to correct the damage, it’s only natural to be hit hard emotionally.

Knowledge is power

CIFAS has recognised that awareness of identity fraud among ordinary people has certainly improved in recent times. However, that increased awareness hasn’t prevented ID fraud cases from increasing.

How they get to us

Let’s review just how the fraudsters get into a position where they can steal our identities.

There are a number of different ways this can happen. According to Action Fraud, the new national centre point for fraud reporting, fraudsters get hold of your details in three main ways.

1. They can get your information or your bank details from your statements or personal bills.

2. They may find out your details from information that you have provided to online shopping sites, social networking sites, or other sources such as birth and death registers.

3. You may give out personal details by responding to a fraudulent email.

Of course there will be variances in terms of the techniques employed by different fraudsters, but so long as you keep those three main techniques in mind, it is possible to protect yourself.

How to protect your identity

It should be pretty clear by this point that protecting your personal details is exceptionally important if you are going to keep the identity thieves at bay.

Your mail

One way that fraudsters will target you is through your post, so it’s very important to ensure your mail is protected. You may be more vulnerable if you live in a property where other people may have access to your post, perhaps a block of flats where there is a communal post area. You may be able to speak to your bank to ensure that if you need to pick up a new credit card or cheque book, you can do so in a branch rather than through the post.

You should also be sure to inform all of the organisations you deal with immediately should you move house, while if you think your post may have been intercepted or stolen, be sure to contact the Royal Mail.

Your documents

Just as important is what you do with that mail once you open it.

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First of all you should ensure that you check all of your statements closely to see if there has been any suspicious activity.

Try to avoid throwing away bank statements or any documents with your name, address and details unless they have been comprehensively shredded.

Those documents that you do keep need to be kept in a safe place – preferably a lockable drawer or safe. And should any of those documents, or your passport or driving licence disappear, be sure to notify the relevant organisation immediately.

It also helps if you get regular copies of your credit record from a credit ratings agency. Through lovemoney.com you can get a free trial with Credit Expert – however, you will be charged once the trial period comes to an end, so bear that in mind.

Guarding your details

Sadly, there are plenty of ways the fraudsters will try to get you to do the hard work for them and hand over your details yourself.

One of the most popular ways for doing this at the moment is through the use of emails. As I wrote about in Scary new banking scams, a new form of computer virus has already contaminated more than 100,000 computers in the UK, allowing scammers access to their personal and banking details.

Always be very careful when opening emails that appear to be from your bank, and be sure to check any links in the email before clicking on them. Most banks will not approach their customers asking for their details in this manner, so that should set your alarm bells off straight away.

However, these emails are not always from banks – they may tell you that you’ve won a lottery, or offer you a great rate on a loan. If it sounds too good to be true, chances are it is, so don’t be fooled. This also goes for any unsolicited phone calls you may receive.

‘Til death do us part

Depressingly, it’s not just your own identity that you need to protect from the fraudsters, but those of your deceased loved ones too.

It’s pretty sick, but criminals will sometimes try to use the identities of the dead to commit fraud. One way to reduce the chances of this happening is to register with services that remove the details of the deceased from mailing lists.

There are three organisations in particular that are pretty good for this, and can provide you with more information – the Bereavement Register, the Deceased Preference Service and the Mailing Preference Service.

Reporting fraud

If you think you have been caught out by the fraudsters, don’t just ignore it. Report it to the police and to the relevant organisation (your bank, the DVLA, etc). You should also contact Action Fraud  - they can provide advice, while details of your experience will go towards helping cut out fraud in the future.

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