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Identity Theft: A nightmare come true

By Emma Tyrell

Impressionist Alistair McGowan, the star of ads warning against identity theft, has had his own id "stolen" by Daily Mirror journalists. Luckily for him it was tabloid journos and not real criminals going through his rubbish. The consequences could have been severe.

Picture the scene. You've just returned from a fantastic skiing holiday, feeling chilled and refreshed – the only worry on the horizon the fact that you have to go back to work the next day.

You settle down with a cuppa, shove all thoughts of work to the back of your mind, and start to sift through the post that's built up during your week away. You expect bills, junk mail and perhaps, if you're lucky, the odd letter from friends or family.

What you don't expect is a letter from a debt collector demanding thousands of pounds by 1pm that same day – for a debt you've never heard of.

That's what happened to Anthony Moore last year. Like hundreds of thousands before him he had fallen victim to identity thieves, who had run up thousands of pounds of debt in his name.

Identity fraud is one of Britain's fastest growing crimes, and costs the UK economy over £1.3 billion a year. CIFAS, the UK's Fraud Prevention Service, reckons there will be 130,000 reported cases this year, up from 101,000 in 2003.

The fraudsters get hold of your personal information, either by chance or design, and then use it to open bank accounts and take out loans, credit cards and other debts. What they're looking for is your date of birth, your address, banking passwords and PIN numbers, and identifying information such as your mother's maiden name. They'll stop at nothing to get it: intercepting mail, phoning victims and pretending to be from their bank, and sending out 'phishing' emails. These emails, which falsely claim to be from your bank or from organisations like eBay and Amazon, ask you to click on a link and generally 'reconfirm' personal details, which the fraudsters can use for identity theft. Banks say they never ask for this information by email, so if you get one, it's virtually certain to be from a fraudster.

Research published earlier this month by Internet browser Lycos says phishing scams have shot up 500 per cent over the past year, with its email filters stopping more than 20,000 a day.

The UK's identity theft hot spots

But some fraudsters resort to far less high-tech methods, and get the information by going through your rubbish looking for old bank statements or completed application forms. Credit reference agency Equifax says some identity thieves even pay homeless people to go through bins looking for receipts.

In Anthony Moore's case, the thief had intercepted a £2,000 credit card cheque made out to Anthony, issued by a credit card account he had once held, but no longer used, and sent to an address where he no longer lived.

The thief managed to cash the cheque, thereby reviving the old account, despite giving a false date of birth – and from then on the interest (which is generally hefty on credit card cheques) started to rack up.

What's on your credit file? Find out here.

When Anthony finally discovered the fraud, he then faced months of frustration as he tried to get the credit card firm to clear the debt and clean up his credit record. It wanted him to report the crime to the police and get a crime number before it would help him, but the police didn't want to know. They argued that if a crime had been committed, it had been committed against the credit card firm, and refused to deal with Anthony.

With the situation fast assuming farcical status, Anthony found the only organisation which was actively helpful was credit reference agency Experian. His credit rating had been trashed by the thief's actions, and now no-one would give him credit.

Experian helped Anthony to deal with the card company, and to clear his record, and eventually placed a password system on his credit account to prevent anyone else taking out credit in his name.

Credit reference agencies say that on average it takes the victims of identity fraud 18 months before they realise they have been targeted. And even then, although the end loser is generally the bank or credit card company, it can take hundreds of frustrating hours proving to them that you have been a victim of identity theft, and clearing your damaged credit record.

The Citizens Advice Bureau is currently trying to help a woman in Essex, whose stolen passport was used by an identity thief to get a second phone on her mobile phone account and run up calls worth £80. The woman's phone was subsequently cut off and the phone company is demanding £80 before it will reconnect her, despite the fact that she has a police reference number.

Another woman, from Ipswich, received more than 50 unpaid parking fine notices totalling thousands of pounds, from several London boroughs. Despite the fact that she has never held a driving licence, a fraudster was able to register his vehicle in her name and run up parking debts. It took the CAB to write to the DVLA and the London boroughs on her behalf before they would accept it was identity fraud.

If you want to try to avoid similar levels of frustration, there are precautions you can take:

If you receive a phone call or email purporting to be from your bank, and asking you to give personal information or passwords or confirm account details, don't oblige. Instead phone your branch to check.
The same goes for any other organisation. If you're suspicious, phone the organisation yourself.
Don't throw away any bank statements, old bills, or any paperwork containing personal information, PIN numbers or passwords, without shredding them first. Shredders are available for as little as £10.
Be extra vigilant when using your cash machine, so that thieves cannot see you enter your PIN.
Choose banking and other internet passwords that are difficult to guess, and do not tell others what they are. Don't use the same password for every account or site.
Don't enter your banking details into a computer in an internet café, or if you must, make absolutely certain that you log-off, and don't ask the site to remember your details. Otherwise those using the computer after you might be able to access your account. The computer might even have hacker software running on it
Don't open any strange email attachments, particularly any ending in .exe, as these may try to scan your computer.
When you move home, contact Royal Mail to get your mail redirected, and do it at least ten working days before you move.
Check your credit rating frequently with the three credit reference agencies ( www.myequifax.co.uk , www.callcredit.co.uk and www.experian.co.uk ). They will tell you if anyone has been applying for credit in your name. (Click here to go to Experian on Yahoo!)
Check your statements against your receipts and contact your bank or credit card company immediately if you spot anything unfamiliar.
Consider using a credit monitoring service, such as Experian's Credit Expert. This sends members alerts whenever there is activity on their credit report to give an early warning of potential frauds. The service costs £49.99 a year, with a free 30-day trial.
If you fall victim to identity theft you must check all your statements for strange transactions and tell all your creditors of your situation. You could also consider subscribing to the CIFAS protective registration service, which will place a notice on your file showing that you may be risk of further identity fraud. Credit reference agencies may issue you with a password so that you can identify yourself as the real you when you apply for credit.