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Warning issued as identity fraud hits an all-time high

Emma Lunn
Written By:
Emma Lunn

Identity fraud cases have reached an all-time high as the cost-of-living crisis bites, according to Cifas.

The fraud prevention service’s latest Fraudscape report shows ID fraud cases rose by almost a quarter in 2022, with this type of fraud now accounting for almost 70% of cases filed to the National Fraud Database.

The Fraudscape report found that last year had the highest volume of cases of fraudulent conduct ever recorded to the National Fraud Database. Of this, cases of identity fraud soared by 23%, and now accounts for 68% of all cases reported to Cifas.

Increase in ID fraud

Last year saw a significant increase in cases of ID attempted against bank cards and telecoms accounts.

Cifas says that over the past couple of years households have become increasingly reliant on credit as the cost-of-living crisis deepens. This, in turn, has made people more susceptible to approaches by criminals who offer fake deals for products and services in order to steal personal and financial information.

The telecoms sector has been the target of a surge in attacks by fraudsters, with an increase in ‘fake phone dealer’ fraud where victims are duped into revealing their personal information after being offered upgrades or discounted offers on contracts.

Cifas found that most victims of ID fraud are aged over 31-years-old, while there has been a significant rise in victims aged 61 or older.

Other types of fraud

The squeeze on living standards has also resulted in a sharp increase in cases of false applications. This refers to where a product or service is applied for using fake supporting information in order to make the individual to appear creditworthy or when an applicant hides previous adverse information.

This type of fraudulent conduct rose by 40% in 2022 compared to the previous year, as individuals altered bank statements or other official documents to inflate their income to secure mortgages, loans or goods.

Loan companies and plastic card issuers saw the biggest increases in cases of ‘misuse of facility’, which was the second highest recorded case type in 2022.

A large proportion of these cases relate to bank accounts, with nearly 40,000 cases indicating ‘money mule’ behaviour – where an individual lets someone else use their bank account to transfer money, often keeping some of it for themselves.

The key age range for mule activity is 21 to 25, with social media remaining a key enabler in the recruitment of mules.

Mike Haley, CEO of Cifas, said: “The cost-of-living crisis has fuelled a significant surge in fraud, with cases filed to the National Fraud Database now at an all-time high. Criminals and career fraudsters have honed their techniques to steal and exploit our personal information to obtain phones, loans and retail accounts in our names, leading to the biggest growth in identity fraud in a decade. In addition, we’ve seen a rise in individuals committing fraud to obtain loans and credit cards by using false documents or hiding adverse credit.

“Criminals are ruthlessly targeting everyone with fraudulent communications by phone, email or SMS text message in order to steal their personal details and account passwords, PINs or other credentials. The current surge in fraud means it is crucial that individuals and businesses take extra care to protect their personal information, and never divulge financial details or credentials that can be later used to commit fraud.”