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Identity fraud is scary. Imagine if a criminal took over your life, running up debts, swindling the benefit system, or committing a more serious crime - all in your name.
It's all very well for the consumer to take security measures, but are the banks doing enough? The have been several high-profile security lapses and the experts admit that the banks could do more. But they also applaud their efforts to combat fraud. The introduction of chip and pin, for example, has cut the incidents of card fraud.
We certainly need the banks on our side. A recent change in the law has pushed the banks onto the fraud frontline. If you believe you are a victim of plastic card, online banking or cheque fraud, you must now report the matter to your bank, not the police. The bank will then investigate and decide if it needs to be passed on.
But at least you shouldn't have to pay for any losses that have arisen from card fraud. Banks assess each case on its own merits - and the customer is legally liable for the first £50 - but most cough up the full amount. There is some anecdotal evidence to suggest they have got tougher since the introduction of chip and pin technology, but the onus is still on the bank to prove the customer has been negligent, not on the customer to prove his or her innocence.
Mark Bowerman of APACS said: "The Banking Code clearly sets out the responsibility of bank in the case of card fraud. If your bank is being obstructive, lodge a complaint. If you don't get a satisfactory response, contact the Financial Ombudsman Service."
Have consumers got complacent?
Peter Hurst, chief executive of CIFAS, the UK's Fraud Prevention Service, said: "No-one should be complacent about identity fraud. The effect on victims can be devastating. Where a victim's identity has been seriously compromised, it can take years to untangle the threads of deception. Even where it is possible to rectify matters quickly, the psychological damage caused by such frauds can cast a long shadow."
No wonder identity fraud often hits the headlines - and no wonder this week is National Identity Fraud Prevention Week.
The statistics would seem to justify our fears. The Home Office calculates that ID fraud costs us a total of £1.7 billion a year - and that's a lot of money. ID fraud is also logged as Britain's fastest growing crime.
It's terrifying, but is it true? The figures can be misleading. The Home Office, for example, tots up all sorts of numbers to come up with its £1.7 billion figure, including the cost of security measures at the passport office.
The definition of ID fraud is also frequently stretched. Is it full-blown theft of someone's entire identity, or does it include plain old card skimming and cloning?
The latest figures from APACS, the payment association, show that losses from card fraud amounted to £263.6 million in the six months to the end of June. But the cost of identity fraud is £18.7 million, or just 7% of the total.
Barry Stamp, joint managing director of the Credit Reporting Agency, said: "Identity theft is extremely rare - there are only a few thousand cases a year. But people are scared witless by the statistics and the headlines."
Some experts are concerned that financial firms are exploiting our fears to sell us insurance against the crime. Which?, the consumers' association, said: "Unfortunately, banks and credit card companies are cashing in on people's fears of fraud by selling needless identity theft insurance. The policies promise to give you access to your credit file and reimburse your legal costs, but cost up to £84 a year. It's highly unlikely that you will need to take legal action as the result of identity theft and it costs a maximum of £2 to get your credit file from each of the three credit reference agencies."
Chances are, you know who stole your ID
ID fraud might be rare, but it's a nasty crime, often committed by someone we know. A report by Experian shows that one in four victims actually knew the fraudster. It might be a lodger, someone who lives in the same block of flats, or even a former boyfriend or girlfriend - anyone who has easy access to our personal information.
Then there's the opportunist thief - the bin raider who preys on our carelessness. And we are shockingly careless. Experian has found that more than 19 million households regularly put sensitive material in waste and recycling bins. More than one in three people throw away personal information, such as driving licences, phone and utility bills. And 13% chuck out entire credit or debit card numbers, along with a record of the card's expiry date and an example of the cardholder's signature.
Not all fraudsters are happy to rake through people's rubbish. Previous address fraud is another common method of identity theft. If you don't redirect your mail when you move house, a thief can easily intercept your post to poach your personal details.
Criminals sometimes stoop even lower, using the identities of dead people to commit fraud.
The growing number of cases of current address fraud bear the hallmarks of more sophisticated criminals. Current address fraud is a relatively complex procedure that requires planning and cunning, often using the internet.
Neil Munroe, external affairs director of Equifax, said: "The opportunist bin raider is still a threat, but fraud is increasingly committed by organised gangs. It is becoming more sophisticated, particularly electronic fraud. The internet has made it quick and easy for criminals to steal information and operate a global network."
Phishing is a common tactic. The criminals will send out a fake e-mail, often supposedly from your bank, to trick you into revealing valuable information such as your pin number or online banking password.
Fraudsters also use software programmes called Trojans that record every keystroke on your computer. The programs are usually downloaded when the user opens a seemingly-innocuous e-mail - and many cannot be detected by anti-virus software.
Today's sophisticated criminals can even target their victims. The wealthy and the elderly are often top of the list. Young, single professionals living in smart rented accommodation are also likely victims of fraud.
London is the identity fraud capital of the UK. And people living inside the M25 are three-and-a-half times more likely to become victims than the national average.
Be aware on networking sites
Again, don't make it easy for the criminals. The boom in social networking sites, such as Facebook and FriendsReunited, has made us more willing to divulge all sorts of personal information to all sorts of strangers - fraudsters included. Even the name of your pet can help a criminal because it is often used as a computer password.
More than 16 million people are registered with Friends Reunited and there are an estimated 28 million members of Facebook. A survey published this week by Equifax revealed that 89% of people have their full name and 38% their date of birth on their profile. More than a quarter also place their education and work history online.
Munroe said: "People don't seem to realise the value of this information. It's terrifying how little information fraudsters need to be able to open accounts in an individual's name, rack up huge debts and leave the victim, at best to spend hundreds of hours sorting out the problem and at worse, picking up the bill.
"Although all these sites provide users with security measures, our survey found that 31% don't use them and a startling 63% make their email address public, also making them a prime target for phishing and scammers."
You might not notice that someone has stolen your identity until the debt collectors - or even the police - come calling. So experts advise you to frequently check your credit report. Jim Hodgkins, managing director of CreditExpert,
Experian's online credit monitoring and identity fraud protection service, said: "Your credit report is part of your financial CV, listing your credit accounts - such as cards, loans and mortgages - and applications for credit. This makes it easy to spot if somebody else is trying to get credit in your name."
Other steps you can take
There are a number of other ways to protect yourself from fraud - not just identity fraud.
It's all very well for the consumer to take security measures, but are the banks doing enough? The have been several high-profile security lapses and the experts admit that the banks could do more. But they also applaud their efforts to combat fraud. The introduction of chip and pin, for example, has cut the incidents of card fraud.
We certainly need the banks on our side. A recent change in the law has pushed the banks onto the fraud frontline. If you believe you are a victim of plastic card, online banking or cheque fraud, you must now report the matter to your bank, not the police. The bank will then investigate and decide if it needs to be passed on.
But at least you shouldn't have to pay for any losses that have arisen from card fraud. Banks assess each case on its own merits - and the customer is legally liable for the first £50 - but most cough up the full amount. There is some anecdotal evidence to suggest they have got tougher since the introduction of chip and pin technology, but the onus is still on the bank to prove the customer has been negligent, not on the customer to prove his or her innocence.
Mark Bowerman of APACS said: "The Banking Code clearly sets out the responsibility of bank in the case of card fraud. If your bank is being obstructive, lodge a complaint. If you don't get a satisfactory response, contact the Financial Ombudsman Service."
Have consumers got complacent?
Peter Hurst, chief executive of CIFAS, the UK's Fraud Prevention Service, said: "No-one should be complacent about identity fraud. The effect on victims can be devastating. Where a victim's identity has been seriously compromised, it can take years to untangle the threads of deception. Even where it is possible to rectify matters quickly, the psychological damage caused by such frauds can cast a long shadow."
No wonder identity fraud often hits the headlines - and no wonder this week is National Identity Fraud Prevention Week.
The statistics would seem to justify our fears. The Home Office calculates that ID fraud costs us a total of £1.7 billion a year - and that's a lot of money. ID fraud is also logged as Britain's fastest growing crime.
It's terrifying, but is it true? The figures can be misleading. The Home Office, for example, tots up all sorts of numbers to come up with its £1.7 billion figure, including the cost of security measures at the passport office.
The definition of ID fraud is also frequently stretched. Is it full-blown theft of someone's entire identity, or does it include plain old card skimming and cloning?
The latest figures from APACS, the payment association, show that losses from card fraud amounted to £263.6 million in the six months to the end of June. But the cost of identity fraud is £18.7 million, or just 7% of the total.
Barry Stamp, joint managing director of the Credit Reporting Agency, said: "Identity theft is extremely rare - there are only a few thousand cases a year. But people are scared witless by the statistics and the headlines."
Some experts are concerned that financial firms are exploiting our fears to sell us insurance against the crime. Which?, the consumers' association, said: "Unfortunately, banks and credit card companies are cashing in on people's fears of fraud by selling needless identity theft insurance. The policies promise to give you access to your credit file and reimburse your legal costs, but cost up to £84 a year. It's highly unlikely that you will need to take legal action as the result of identity theft and it costs a maximum of £2 to get your credit file from each of the three credit reference agencies."
Chances are, you know who stole your ID
ID fraud might be rare, but it's a nasty crime, often committed by someone we know. A report by Experian shows that one in four victims actually knew the fraudster. It might be a lodger, someone who lives in the same block of flats, or even a former boyfriend or girlfriend - anyone who has easy access to our personal information.
Then there's the opportunist thief - the bin raider who preys on our carelessness. And we are shockingly careless. Experian has found that more than 19 million households regularly put sensitive material in waste and recycling bins. More than one in three people throw away personal information, such as driving licences, phone and utility bills. And 13% chuck out entire credit or debit card numbers, along with a record of the card's expiry date and an example of the cardholder's signature.
Not all fraudsters are happy to rake through people's rubbish. Previous address fraud is another common method of identity theft. If you don't redirect your mail when you move house, a thief can easily intercept your post to poach your personal details.
Criminals sometimes stoop even lower, using the identities of dead people to commit fraud.
The growing number of cases of current address fraud bear the hallmarks of more sophisticated criminals. Current address fraud is a relatively complex procedure that requires planning and cunning, often using the internet.
Neil Munroe, external affairs director of Equifax, said: "The opportunist bin raider is still a threat, but fraud is increasingly committed by organised gangs. It is becoming more sophisticated, particularly electronic fraud. The internet has made it quick and easy for criminals to steal information and operate a global network."
Phishing is a common tactic. The criminals will send out a fake e-mail, often supposedly from your bank, to trick you into revealing valuable information such as your pin number or online banking password.
Fraudsters also use software programmes called Trojans that record every keystroke on your computer. The programs are usually downloaded when the user opens a seemingly-innocuous e-mail - and many cannot be detected by anti-virus software.
Today's sophisticated criminals can even target their victims. The wealthy and the elderly are often top of the list. Young, single professionals living in smart rented accommodation are also likely victims of fraud.
London is the identity fraud capital of the UK. And people living inside the M25 are three-and-a-half times more likely to become victims than the national average.
Be aware on networking sites
Again, don't make it easy for the criminals. The boom in social networking sites, such as Facebook and FriendsReunited, has made us more willing to divulge all sorts of personal information to all sorts of strangers - fraudsters included. Even the name of your pet can help a criminal because it is often used as a computer password.
More than 16 million people are registered with Friends Reunited and there are an estimated 28 million members of Facebook. A survey published this week by Equifax revealed that 89% of people have their full name and 38% their date of birth on their profile. More than a quarter also place their education and work history online.
Munroe said: "People don't seem to realise the value of this information. It's terrifying how little information fraudsters need to be able to open accounts in an individual's name, rack up huge debts and leave the victim, at best to spend hundreds of hours sorting out the problem and at worse, picking up the bill.
"Although all these sites provide users with security measures, our survey found that 31% don't use them and a startling 63% make their email address public, also making them a prime target for phishing and scammers."
You might not notice that someone has stolen your identity until the debt collectors - or even the police - come calling. So experts advise you to frequently check your credit report. Jim Hodgkins, managing director of CreditExpert,
Experian's online credit monitoring and identity fraud protection service, said: "Your credit report is part of your financial CV, listing your credit accounts - such as cards, loans and mortgages - and applications for credit. This makes it easy to spot if somebody else is trying to get credit in your name."
Other steps you can take
There are a number of other ways to protect yourself from fraud - not just identity fraud.
- Check your credit file regularly. The three main credit reference agencies are Experian, Equifax and Callcredit.
- Use a different password for each site or account - and avoid obvious passwords such as your mother's maiden name, family names or dates of birth. Don't be one of the 6% of people who use 'password' as a password.
- Leave identity documents, such as driving licence or passport, in a safe place at home. And don't ever carry your address in your wallet.
- Don't throw away entire bills, receipts, credit or debit card slips, bank statements or even unwanted mail. Destroy discarded documents, preferably by burning or shredding.
- Don't ever reveal your PIN number to anyone and take care when giving out card details over the phone or in a shop.
- Check your bank statements and credit card statements carefully for suspicious activity. Think about using a separate credit card in petrol stations and restaurants, where the risk of skimming and cloning is high.
- If you are shopping online, always ensure that the payment pages are secure. Also, install up to date anti-virus software and firewalls.
- Use the Mailing Preference Service, Telephone Preference Service, Fax Preference Service and Email Preference Service to reduce the amount of junk mail and cold calls you receive. Also apply to BT for 'Anonymous Call Rejection'.
- If you move house, make sure you redirect your mail for at least a year.
