UK ID Fraud Hits an All-Time High

UK identity fraud hit an all-time high last year, driven heavily by online attacks, according to the latest stats from Cifas.

The fraud prevention service’s annual Fraudscape report compiles data from 306 participating organizations, so can be seen more as a snapshot of trends than a comprehensive tally of incidents.

It claimed identity fraud stood at 174,523 cases in 2017, up 1% on previous years and driven mainly by online trends.

"It remains a predominantly internet-based offence, with 84% of identity fraud occurring through online channels," a Cifas spokesperson told Infosecurity.

Online retail fraud jumped by 49%, while Cifas claimed that 80% of fraudulent applications are now made online.

Other industries hit by increases in fraud included telecoms (47%) and insurance (1600%).

It is likely that many of these attempts also included an online element as scammers looked to move away from card fraud by targeting mobile phone contracts, online retail accounts, retail credit loans and short-term loans.

A PwC report from February claimed that nearly half of UK organizations (49%) have suffered from cyber-related fraud in the past two years.

Cifas also warned of an 11% growth in bank accounts being used by money mules, representing over 32,000 cases. Many of these individuals are youngsters, presumably attracted by the prospect of easy money but unaware of the implications of their actions.

Cifas recorded a 27% growth in the number of 14-24-year-olds identified as money mules.

“With more and more people sharing data, transacting, setting up businesses, dating and chatting online this [fraud] trend is only going to continue,” said MP Conor Burns.

“That is why I set up the All-Party Parliamentary Group on Financial Crime and Scamming last year, to raise awareness of this issue within parliament. Fraudscape shows how prevalent this crime is and all of us — government, industry, third sector and individuals have a role and responsibility in preventing it.”

Lisa Baergen, director at NuData Security, described UK identity fraud as “appallingly high” and put it down to more fraudsters willing to commit crimes, more data available on the black market, and more financial institutions and merchants vulnerable to attacks.

“Organizations that transact online, such as banks, e-commerce stores, travel agencies and other vendors can take a more nuanced approach to authentication by evaluating as much contextual information about customer’s interactions as possible to determine if it truly is the right user,” she explained.

“Multi-layered technology that includes passive biometrics and behavioral analytics can distinguish good from bad users even when new devices and correct credentials are used because they rely on a different set of data — the customer’s behavior. Removing the value of stolen credentials from the hands of criminals can re-balance the online identity proofing environment for consumers and organizations.”

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