The high price of identity theft
Thursday, 16 February 2006 12:00
The true cost of identity theft goes far beyond the £1.7 billion a year monetary implications, a new report warns.
And because of this the National Consumer Council (NCC) is urging companies to do more to help customers who fall victim to identity fraudsters.
Identity fraud is when a criminal dishonestly impersonates another individual to their financial benefit.
Criminals obtain personal information about someone, for example from bank statements and credit card bills they have found in a bin, and use this to get access to their bank account or to take out credit cards and loans in their name.
New government figures show that the financial cost of identity fraud to the UK is far higher than previously thought, at £1.7 billion a year.
But that is just the start.
"Identity theft has devastating, extremely stressful and often long-term consequences for its victims," said the NCC's Claire Whyley.
"They are left struggling on their own to unravel a complex web of knock-on effects across a plethora of companies and organisations. Too often they are treated as criminals, caught up in a lonely Kafka-esque nightmare of trying to prove who they are.
"Their life goes on hold. Their bank no longer recognises them. They're refused credit. And they get chased for the unpaid bills of the fraudsters who've stolen their name.
"This can't be right. Innocent victims should not be made to feel like criminals. Instead, we want to see businesses - especially banks, insurance companies, credit providers, phone and utility companies - give ID fraud victims more help and support in untangling the mess and smoothing the stress."
NCC is calling for companies to create dedicated identity fraud customer helpdesks, where victims could be allocated a named person to help until everything is sorted out.
Additionally, sector-wide support services are needed in the banking, insurance, credit, mobile phones and the utilities industries, the NCC claims.
In the meantime, credit reference agency Experian has also offered advice on preventing identity fraud.
Top ten tips to avoid becoming a victim of identity fraud
- Take care of your personal information by keeping any documents containing personal information, including transaction slips and proofs of identity, secure.
- Never throw away whole receipts, bank statements, utility bills or other documents that can be used by a fraudster to assume your identity. Your rubbish bin is a target for fraudsters. Always thoroughly destroy personal information before throwing it away, preferably by using a personal shredder.
- Check your receipts against your card and bank statements carefully. If you find an unfamiliar transaction, contact your card issuer or bank immediately. If you bank online, use this facility to keep a constant eye on any transactions occurring on your accounts.
- Monitor the information on your credit report. The fact that it takes most people nearly a year and a half to discover they are victims of identity fraud vividly demonstrates that most of us make life far too easy for the criminals. People who regularly monitor their credit reports typically spot if someone is attempting identity fraud in their name within a matter of weeks.
- Never disclose personal or financial details to anyone 'cold-calling', even if they claim to be from your bank, the police or another official organisation. It is always a good idea to phone them back on the number you have for them, not the one they may give you.
- Use different passwords for different accounts. If a fraudster accesses one, they are less likely to be able to access all accounts.
- If you have documents stolen, there is a strong chance these will be used to commit fraud in your name.
- If you move home, redirect your post from day one. The new occupants may at best just throw letters in the bin instead of forwarding to your new address; at worst, they might use the information to steal your identity.
- Only provide personal information and credit card details on secure sites displaying bone fide logos of secure payment systems, such as Verisign or Worldpay.
- Try to keep your personal information in different places around the house so a thief will find it more difficult to obtain complete information. Keep as much as possible locked up.
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