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Your Money > Personal Finance Articles > War on Fraud
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By Naomi Caine
You might think it's rubbish, but some of the stuff you throw away could be worth a fortune to a criminal. In a "bin-raiding" experiment, nearly all (97%) households had thrown out papers such as envelopes that gave their full name, title, address and postcode. A third had discarded their credit and debit card numbers. And almost half of dustbins searched contained the home owner's bank account number. Professor Martin Gill, an expert on identity fraud, says: "The internet is now a widely used tool by identity thieves, but the use of paper-based documents containing personal information is still commonplace." If they can't get personal information from your dustbin, criminals can steal documents during a burglary, take post from doorsteps or redirect mail. Impersonating the dead is also a common tactic. Stolen cheques Fraudsters often intercept cheques sent in the mail and then use false id papers to open bank accounts, which are then used to cash the cheques. Steve Truick of the Metropolitan Police does not think it's safe to send cheques through the post. He says: "It is very easy to buy false identity documents such as driving licences over the internet and use them to open an account with a stolen cheque. I no longer send cheques through the post at all because I know the risks." You might also find it difficult to recover the money from your bank because it too is a victim of the fraud. Click here to get your FREE Experian credit report Click here to visit the Yahoo! ID Fraud Centre Tyron Hill, a spokesman for this week's National Identity Fraud Prevention week, says: "People spend thousands of pounds protecting their homes against burglary yet our research shows virtually everyone in the country is almost handing over their identity to bin raiders. We must start to put up a fight." It's not only consumers who are slipping up. HSBC recently carried out a review of 300,000 current accounts for evidence of fraud following concern about lax security at Indian call centres. It denied any details had been leaked but was reacting to growing concern of an international trade in identity theft. A recent investigation exposed an overseas website selling UK residents' identities for as little as £1 each. The criminals use so-called "Trojan" software to track every keystroke made by the victim, enabling them to find out all your personal data, which can be sold on to fraudsters. They can then use the information to trade online using assumed identities or to obtain bogus documents. Click here to get your FREE Experian credit report Click here to visit the Yahoo! ID Fraud Centre Junk mail The growth in junk mail from credit card companies has also been linked to the rise in identity fraud. Credit-card applications, many of which are sent to people at the wrong address, often contain sufficient information to open accounts fraudulently. Identity theft affects more than 100,000 people and costs the economy £1.7 billion a year. The crime seems likely to increase. A recent report from insurer CPP revealed that millions of Britons leave themselves open to identity fraud on average 35 times a week, largely by failing to safely dispose of bank statements, receipts and other unwanted documents. "ID fraudsters are waging a war to obtain our personal details," says Owen Roberts of CPP. Your number's up It takes on average more than a year to discover the fraud, according to credit reference agency Experian. By this time, the criminal could have run up thousands of pounds of debts in your name. Unpaid debts can lead to distressing problems with debt collectors and court action - they can even prevent victims getting a mortgage or other loan. Often the first sign there's anything amiss is when a credit card or loan application is refused, or unpaid bills turn up for items you never bought. Sandra Quinn of the Association of Payment Clearing Services (APACS) says: "If you find you are a victim, then contact the organisation concerned immediately, and let them know it isn't you who has run up the debt. You should also report the crime to the police, and request a crime number which you should provide to any firm you contact." It might not be as easy as it sounds. The police are reluctant to hand out crime reference numbers for fear of boosting the crime figures. But no crime number might mean no sympathy from your bank. At the moment most financial firms protect their customers against serious loss from identity theft. But if you don't have a crime number, you could be in for a fight. A spokesman for Credit Industry Fraud Avoidance System (CIFAS) says: "Keep a record of everything. Recovering from identity theft can be a complicated process so keep copies of all correspondence and note who you have spoken to and when. You should also send all letters by recorded or special delivery and keep track of how much time you spend dealing with the problem." But let's not get too carried away. Identity fraud covers a range of crimes. Full blown identity theft is very rare; it is far more common for a criminal to take over an existing account than to pretend to be you and start applying for credit in your name. You have to weigh up the risk. It is small - and it could be even smaller if you took some simple precautions.
Click here to get your FREE Experian credit report Click here to visit the Yahoo! ID Fraud Centre You can also join the CIFAS Protective Registration service, which checks applications made in your name when they're received by CIFAS members, including credit card firms, loan companies and mortgage lenders. The service costs £11.75. You can download an application form online at www.cifas.org.uk. Many companies offer extra services to combat the fraud problem. Halifax's Identitycare and Royal Bank of Scotland's PrivacyGuard cost about £7 a month. They claim to help with identity protection and provide assistance should you become a victim. However, consumer group Which? thinks these packages are a waste of money. As part of the fraud awareness week consumers can test their vulnerability to fraud at www.stop-idfraud.co.uk. For further advice on identity theft visit www.identity-theft.org.uk Click here to visit the Yahoo! ID Fraud Centre Useful links:
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