Public warned of surge in fraud numbers

The latest figures show that in the first four months of this year there was an 82 per cent rise in the numbers of bank, credit card or other accounts being taken over by a criminal and cash being stolen. Sometimes accounts are hijacked as a one-off to pay for goods but in some cases they can be completely emptied.

Last night, CIFAS, the UK’s fraud prevention service warned businesses and individuals throughout the region to be on the look out. It says the public and businesses need to be aware of how criminals can operate and the type of frauds they commit:

There has been a massive rise in identity theft in recent years: from 77,500 cases in 2007 to over 113,000 cases in 2011, with organised criminals frequently targeting insiders within an organisation in order to obtain the personal data needed to commit this crime.

The value of reported fraud, as revealed in BDO Stoy Hayward’s Fraudtrack report rocketed to more than £2bn in the UK in 2011, representing a 50 per cent increase on 2010’s figure of £1.4bn. This means that since its launch in 2003, when fraud totalled £331m, there has been a seven-fold increase in the cost of reported fraud.

The internet was used to commit 71 per cent of all account takeovers between January to April 2012.

Figures earlier revealed by the Yorkshire Post showed cases of identity fraud across Yorkshire rose by 13 per cent in the first nine months of 2010. Identity fraud is where a person steals somebody’s personal details and then opens accounts or buys goods in their name making use of their good credit rating.

There are a number of different types of fraud. This week CIFAS and the Chartered Institute of Personnel and Development (CIPD) launched free guidance to help employers to understand the threats posed by rogue employees. In 2001 there was a 14.5 per cent increase in cases where staff committed fraud at a company, in comparison with the previous year.

Arjun Medhi, CIFAS staff fraud adviser, says: “The majority of staff within any organisation are trustworthy and honest. But businesses must understand the scale of the threat posed by the small proportion of staff who act dishonestly and defraud their employer and the numerous ways in which an organisation can be targeted.”

In the first four months of this year there has been an 82 per cent increase in the numbers of criminals who have been able to take over an account owned by a person or business and spend the cash. In some cases they cancel existing cards and order replacements for themselves, leaving them able to use the account as if it were their own.

They get passwords and other security information through a number of methods from computer hacking, to befriending people on social network sites to get personal information from them, to intercepting post.

Richard Hurley, communications manager at CIFAS, said: “The takeover of an account requires data: from a password and username, through to PINs or security answers. The availability of data is something that society is coming to terms with, but individuals and businesses must see the clear dangers in these figures: showing how fraudsters are able to exploit habits or systems to acquire such data.”