Report reveals record levels of identity fraud in 2017

Cifas, the UK’s leading fraud prevention service, has released a new report identifying and detailing the fraud trends, like identity fraud, from over 300,000 cases of fraudulent conduct recorded in 2017.

The data, from 306 organisations, including many major UK brands, is one of the most comprehensive pictures of fraud and fraudulent attempts in the UK. Although there has been an overall drop of 6% in cases recorded by Cifas members, the new figures show concerning increases in some areas.

Key findings from the Cifas’ annual report Fraudscape include:

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  Report reveals record levels of identity fraud in 2017

  Identity fraud continued to rise, hitting an all-time high of 174,523 cases in 2017 (up 1% from 2016). 95% of these cases involved the impersonation of an innocent victim

• Eight out of 10 fraudulent applications were made online
• There was a 27% increase in 14-24 year olds becoming ‘money mules’
• Overall bank accounts identified as being used as ‘mule’ accounts were up by 11%
• More than a third of bank account takeover victims were over 60-years-old
• Organisations successfully prevented over £1.3 billion in fraud losses through noncompetitive data sharing

The number of identity frauds increased once again in 2017, with almost 175,000 cases recorded. Although this was only a 1% increase compared with 2016, it’s a 125% increase compared with 10 years ago. The difference this year, over previous years, is that the increase is not down to increases in fraudulent applications for plastic cards and bank accounts, which are the products most frequently targeted by identity fraudster, but due to targeting of other sectors such as telecoms, online retail and insurance.

This ‘retargeting’ by identity fraudsters can be seen as a shift towards more accessible products, such as mobile phone contracts, online retail accounts, retail credit loans and short-term loans.

Also increasing last year was the number of money mules – individuals who allow their bank account to be used to facilitate the movement of illegal funds – a form of money laundering. Individuals are being targeted online by criminals promising ‘easy cash’, or encouraged by an acquaintance to transfer funds for them in exchange for a payment.

In 2017, Cifas members identified almost 11% more bank accounts that bear the hallmarks of money mule activity than they did in 2016 – over 32,000 cases. Criminals are continuing to target younger people – there was a 27% growth in the number of people aged 14-24 that have been identified as carrying out this type of fraud.

The findings also reveal that more than a third of victims of bank account takeovers were over 60, so age is a key consideration for facility hijackers when selecting who they target.

“It’s clear from this year’s Fraudscape that fraud in the UK continues to evolve. As some targets become harder to crack, criminals turn to what they consider are softer targets. Fortunately, many of these sectors such as telecoms and insurance, share their fraud data through Cifas and are detecting more fraud attempts. As fraudsters see their attempts to obtain these products become more difficult, the question will arise about where they will target next,” comments Mike Haley, Deputy Chief Executive, Cifas.

“The small reduction in the overall number of detected frauds is welcome but it’s hard to say whether we are beginning to see the turning of the tide. The absolute volume of fraud is still frighteningly high and much more still needs to be done to reduce its prevalence, including greater collaboration and sharing of fraud risk data between industry, government, and law enforcement.

Working together, organisations who are members of Cifas prevented  over £1 billion worth of fraud last year and Cifas will continue to lead the way in the fight against fraud and financial crime.”

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