The UK fraud prevention service CIFAS, which targets credit applications fraud, has 300 corporate & bank members and maintains a database of 500,000 persons in UK who are active fraudsters. CIFAS really understand credit fraud and in their annual report on fraud, ‘Fraudscape - the essential guide to UK fraud trends’*, they write that in 2014 the UK recorded frauds increased by 25 per cent last year, in total there were 276,993 frauds recorded in 2014, compared to 221,075 in 2013.

41% increase in identity fraud with young adults increasingly targeted

The single biggest threat continues to be identity fraud - 41 per cent of all frauds recorded in 2014 fall into this category. Identity fraud is when criminals abuse personal data or identity details to impersonate an innocent victim or to create fictitious identities to steal money. The main identity fraud trends were:  

• 113, 839 identity frauds recorded, a five per cent increase on 2013
• the average age for identity victims is 46, and men were 1.7 times more likely than women to have their identity stolen
• young adults are increasingly becoming targets – the number of young adult identity fraud victims aged between 21 – 30 has increased by 51.7 per cent since 2011, from 9,789 to 14,850. This suggests that as digitally savvy young people enter their twenties and increase their access to financial products, they are increasingly at risk;
• older groups are still at risk – there was a 15 per cent rise in the numbers of identity fraud victims aged over 55, with 25,346 in 2014 compared to 22,004 in 2013.

Account takeover fraud

The rise in identity fraud was accompanied by a significant drop in takeover of accounts (where fraudsters hack into or “take over” existing accounts). These trends underline criminals’ ability to adapt – as it has become harder to take over existing accounts due to better security, criminals have shifted their attention to using other people’s identities, or creating entirely false identities, to open new ones. 

CIFAS fraud prevention programme and what needed in future

By working across sectors, CIFAS member organisations estimate that they prevented £1 billion worth of fraud in 2014. (CIFAS fraud cases are streamed daily to the National Fraud Intelligence Bureau, run by the City of London Police, to create crime packages for possible further investigation by law enforcement agencies.)

The report makes a number of recommendations for 2015/16:

• UK needs a national measure of fraud losses and fraud levels: Government needs to work with industry to re-establish this measure. CIFAS believe that until we understand the scale of the loss, society cannot truly tackle it.
• Greater research is needed into the exact point at which data is compromised: CIFAS Members cannot always know at what point their customers’ identities have been compromised and individuals often do not know themselves. Yet this information would be vital in focusing prevention efforts. 
• Further research into the involvement of organised criminals in fraud: This year’s data provides further evidence that organised criminals are behind numerous fraud trends. More research is needed to verify and better understand the involvement of organised criminals in fraud and the extent to which money obtained through fraud is used to fund further criminal activity.
• A co-ordinated education and awareness campaign on fraud, led jointly by Government and industry: People of all ages need to be savvier to frauds, and fraudsters, in order to protect themselves better. Fraud trends suggest that some may be allowing their details and accounts to be used by criminals, without a full understanding of the seriousness of the crime.
• A comprehensive review of the sentencing guidelines for fraud: The public must have faith that when frauds are reported, criminals are punished appropriately. This will also encourage people to report fraud, adding to our overall understanding of the UK’s fraud profile.

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* The report is based on fraud cases from 245 CIFAS Members which span a range of sectors. CIFAS believe that the data is a sound barometer for fraud trends in the UK. However it is not the full picture and the true numbers of frauds and victims will be higher.

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CTMfile take: Credit fraud is growing and threatens the financial viability of consumer projects world-wide. CIFAS’s and similar programmes around the world need corporate treasurers’ support.