Identity theft
On the increase
Cifas, the fraud prevention service, has revealed that instances of identity theft have surged by 22% in the six months to the end of June compared to last year; 32,000 victims were affected over that period. But not all identity theft cases are reported and the Police believe at least 100,000 people are affected by ID theft every year.
How its done
Fraudsters can access your bank details by intercepting your mail or scouring through your rubbish, they then tell your provider that you have moved house. Once amended, the conmen will ask for credit cards and chequebooks in your name to be sent to their address. It could be weeks before you realise something is wrong, by which time thousands of pounds of debt could have been racked up in your name.
Some criminals go a step further. They discover your National Insurance number or get copies of birth certificates to apply for other documents such as a passport or driving licence. They can then open new accounts and take out loans or credit agreements in your name - something that is much harder to detect unless you keep an eye on your credit reference details.
The trouble is, few of us do. Only 1 in 20 UK cardholders has ever requested to see data held on them by the three main credit reference agencies. The details of the reference agencies are on our comparison page where you can also apply for your preferred report. A Basic report is £2 or try the online free trials offered by experian equifax or CallCredit
Reduce your risk
Guard your National Insurance number. It is the key to your credit report and bank accounts and is the prime target of criminals. Monitor your credit reports from credit report agencies regularly. If an identity thief opens a credit card in your name, you will find out before too much damage is done. Keep track of your bill dates. A missing bill could mean that a thief has changed your address. Do not carry extra credit cards or other important identity documents about your person or vehicle except when needed. Examine the transactions on your credit card statements before making a payment. Cancel unused credit card accounts. The fewer you have, the fewer you have to keep track of. Never give your credit card number or personal information over the phone unless you have initiated the call and trust that business. Shred your old bank statements and credit card bills. Sales of document shredders are booming. Argos has sold more than 2.6m over the past 12 months; Tesco sold 30,000 last month alone, double the number sold in July 2005. If you buy a shredder, make sure you get a crosscut machine, which dices paper into tiny squares rather than strips, which could be stuck back together.
What to do when struck
People who have had their identity stolen face huge problems. Banks and credit card companies base their lending decisions partly on the information you provide on the application form, but also on your credit history. Any black marks and you could have trouble getting credit, be it a mortgage, credit card or loan. It has been known to take 3 months to sort out fully.
If you discover irregularities while checking your statements or your credit file, contact the lender immediately. You should also inform the police and obtain a crime number.
Most credit card companies indemnify the user against any fraud, providing that any card loss or unusual transaction is reported immediately and providing that you have not been negligent in your card use. It may also be necessary to offer some proof to ensure that any fraudulent transaction is appropriately treated. Check your credit card's terms and conditions to see what protection they give you and what your obligations are to prevent fraud.
You may also want to consider viewing the Home Office offical site to identy theft.
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