Identity fraud and how to prevent it

Identity fraud is one of Britain's fastest growing crimes, costing more than a £1 billion a year. Silent, difficult to investigate and very simple - its effects destroys the credit history of helpless victims, blackens their names and leaves banks millions of pounds out of pocket. According to crime statistics, many of us are carelessly throwing out bank and credit card statements, bills and receipts - giving both organised crime rackets and opportunistic thieves access to our identities, and our cash.

Once these personal details are in their hands, they can open bank accounts or credit cards in your name, or steal money from your existing accounts. And this won't just leave you in the red; it could also ruin your credit rating and disrupt your life. Organised criminal gangs even pay "bin raiders" to go through people's rubbish and steal documents containing their personal information.

A recently commissioned poll by Populus showed that 40% of the public rated identity fraud as their major concern in a list of crimes that included burglary (27%), mugging (21%) and pickpocketing (3%).

While a large majority of people claimed to shred old bills and statements, analysis of the household rubbish from ten streets in south London found that 77% contained at least one item which could assist identity fraudsters.

"Identity fraud is not a victimless crime, warns Jane Reay, from the crime prevention charity Crimestoppers: "It can take up to 300 hours of frustrating phone calls to deal with banks, credit card companies and other lenders - incurring enormous personal time, effort and cost."

According to fraud prevention service, Cifas, identity fraud is costing the UK around £1.3 billion a year. "Identity fraud is a growing issue in the UK," says David Lennox of CIFAS, "It is a silent crime with victims often unaware that anything is amiss until they receive demands for loan repayments or bills for goods they have not purchased, or discover transactions on credit card or bank account statements that they don't recognise. We must do everything possible to make life harder for identity thieves."

If you are a victim - act quickly, warns Cifas: while you will not normally be liable for debts accrued by a fraudster using your identity, it will be down to you to sort out the mess. If any of your credit or debit cards, charge cards, cheque guarantee cards or cheques are lost or stolen, inform the issuer as soon as possible. If you receive bills or statements that are addressed to you but you know don't belong to you, contact the organisations concerned as soon as possible to alert them to the fraud.

If you see transactions on your statements that aren't yours, tell the relevant organisations, for example your bank or building society, immediately. Contact your local Police station and report the identity theft as a crime. Request a crime number and provide this to any company you contact. Keep a record of everything! Recovering from identity theft can be a long and complicated process

Top tips on how to protect against identity fraud

• Treat your personal data as confidential dont give it a way easily.
• Shred any documents showing your name, address or other details before discarding - such as bank statements, utility bills, pre-filed applications forms, chequebook stubs and debit and credit card transaction receipts.
• Check your bank credit card statements for unusual transactions.
• Regularly get a credit report from a credit reference agency
• Ensure you formally close any accounts you no longer require. A fraudster may reactivate dormant accounts without your knowledge.
• Never give information to an unknown caller who cant prove their identity even if they do claim to be from your bank. Offer to call them back.
• Dont click on phishing emails. Banks and building societies will never send you an email asking for personal details. If you receive such an email it is unlikely to be legitimate and if it ask you to click on a link and enter your personal detail, its a phishing email from criminals trying to steal your bank details.
• Keep important documents such as your passport, driving license, birth/marriage certificate in a safe place but not together. They are as valuable to a criminal as jewellery and can easily be sold to an identity fraudster.
• If you move homes, consider using a Royal Mail re-direct for at least a year to make sure all post if forwarded to your new address.

31 March 2006 © Moneyextra.com

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