Identity thieves find new way to beat the credit crunch

 

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Posted on 8 Oct 2008 at 12:41

Online fraudsters have moved to targeting existing bank and credit card accounts. According to MPs, the credit crunch has made it difficult for cyber criminals to steal money by setting up accounts using fake information.

The All Party Parliamentary Group on Identity Fraud said tighter lending rules had deterred fraudsters from trying to use fake details to take out a loan or create a bank account.

"There is no longer a guarantee that they will get credit by applying assuming another person's identity, so they are instead tapping into accounts which already exist," their report said.

Online fraudsters have, in the past, tended to steal personal details by sending random emails that they claim come from a genuine business asking for unsuspecting consumers to confirm account information. Such bogus emails are designed to look like they are from a bank, an online shop or a government department.

Criminals then use the details stolen in phishing attacks to steal money from people's accounts.

People earning more than £50,000 a year are more likely to be targeted, according to the report. Identity thieves are also behind a rise in "card cloning," where credit or debit card details are copied onto a bogus card.

The number of incidents of card cloning and phishing increased by 182 per cent in the second quarter of 2008, compared with the same period a year ago, the MPs said.

The UK government reckons identity fraud costs Britain's economy £1.7 billion a year, for losses to insurers, card fraud, bogus benefit claims and unpaid fines, bills and taxes.

In their second annual report, the MPs warned that fraudsters will try to use the 2012 London Olympics to commit more crime. People buying tickets or merchandise online may be targeted, while shops should be on alert for card fraud.

Author: Theo Salvador