New figures from Experian have revealed a major spike in fraud - from 24 cases per 10,000 applications last year - to 35 per 10,000 this year. What's even more alarming is that within these figures, ID theft has taken a new and more worrying role.
Fraud committed by assuming someone else's identity and then applying for a loan or credit card in their name now accounts for an astonishing 47% of all fraud. This is up from 30% last year, and shows that we are more at risk than ever.
Most common fraud
The criminals are particularly likely to use ID theft to make applications for credit cards and loans (some 79% of all credit card frauds and 78% of all loan fraud, is the result of ID theft). However, the experts have seen current accounts being targeted more often too. Last year 21% of all fraud attempts on current accounts used stolen identities: this year the proportion has doubled to 42%.
The experts are trying to emphasise that a spike in fraud may not be because the number of frauds themselves are rising, but because the number of frauds being detected are increasing. Nick Mothershaw, UK Director of Identity & Fraud at Experian, said: "Our latest analysis shows the financial services industry is making continued and significant progress in the fight against fraud, and suggests financial services providers are investing in fraud detection and prevention measures in order to better protect customers from identity thieves."
However, he also admits that "recent high profile instances of data theft show that there is still much to be done." So we need to take our own precautions to limit our risk of becoming a victim of ID theft. There are seven useful steps we all need to take:
1. Protect your post
Most of this kind of theft is either committed by stealing post from a communal area, using a previous address for you, or forwarding your post elsewhere. It's vital, therefore, to secure your post if it is delivered to a communal area, and be aware of what you are expecting to receive - so you know if it goes astray.
You are particularly vulnerable when you move house, so make sure your post is forwarded by the Post Office for at least a year, and tell every institution that you deal with that you have moved home - as quickly as possible.
2. Get on the electoral roll
Anyone applying for any financial product in your name will have the electoral roll checked against the address they are using. Getting on the roll in your real address will prevent them setting up an alternative.
3. Protect your rubbish
Buy a shredder, and before you throw anything away that shows your name and address, pass it through the shredder.
4. Don't reveal your details
Phishing for information either by email, post or phone is still one of the most common ways for thieves to get hold of your details. If anyone calls and asks for information, refuse. No-one - including the banks and the taxman - would ever contact you and ask you to provide things like your account number or passwords.
5. Check bank and credit card statements
Make sure you recognise every transaction, and if you're unsure, call the bank for details.
6. Keep identity documents safe
Things like your driver's licence and passport need to be kept in a safe place - ideally somewhere lockable. Don't take them out and about with you unless you really need them.
7. Get hold of your credit report
This will list out every single credit agreement and application in your name - so check it thoroughly to make sure you recognise everything on the list.
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