DECEASED FRAUDS – RESEARCH RESULTS

Introduction

In December 2004, CIFAS published research into Impersonation of the Deceased fraud. Making use of data from the period froom 2001 to October 2004, these figures gave a full and frank assessment of the scale of this type of fraud and provided a greater, more prominent, platform for CIFAS to campaign for the release of death registration information for fraud prevention purposes.

The following represents the findings and results of this research.

Background

Between 2001 and 2004, CIFAS Members reported substantial increases in deceased impersonation frauds.

Figures were hard to come by due to the reporting mechanisms being largely manual at the time, but in 2001 a sample of deceased data was matched against the CIFAS file. This was then validated by a survey of some large CIFAS Members. The two exercises taken together revealed there were 5,000 cases, about half of which were not recorded as frauds but as collections cases or written off unpaid debts. In 2002 the figure doubled to 10,000 and in 2003 it rose to 16,000. For 2004 the projection was 20,000 cases. Added together, the reported and projected figures for the period 2001 to 2004 were:

2001	5,000
2002	10,000
2003	16,000
2004	20,000 anticipated (at the time of publication)
Total	51,000

     

In 2004 Members of CIFAS reported a surge in the number of cases with some organisations identifying as many as 30 per week.

Research Exercise

This research exercise had several aims:

• To validate the previous estimates of the numbers of deceased frauds
• To quantify the scale of the problem
• To confirm the number of deceased frauds being reported as other fraud types, due to the lack of access to data to confirm deaths

Nearly 5 years of CIFAS data was matched by address against deceased records from two private sector databases available for screening data and for suppressing direct mail. Callcredit carried out the data matching for CIFAS.

For older deceased data there was virtually 100% coverage of deaths but for deaths between 2002 and 2004, the percentage varied from 0% shortly after a death to 75% later on.

Approximately 900,000 CIFAS fraud records were used in the research dating from January 1999 to October 2004.

The Results

The research results provided the clearest indication, to date, yet that deceased fraud occurred on a scale greater than previously indicated. The results showed that:

• 97,000 matches were made up as follows:

1999	7
2000	3,840
2001	16,357
2002	22,327
2003	27,970
2004 to October	26,977
Total	97,478

  

• The majority related to the period 2001 to 2004 where existing reporting mechanisms produced a figure of 51,000. We then estimated the scale of the UK problem not at 51,000 cases since 2001 but 180,000. This figure was based on the 97,000 matches from the research and a 50% uplift to include cases that were not recorded as frauds but as collections cases or written off unpaid debts. This figures was always likely to be an under-estimate as the deceased fraud data-set used in this research exercise was incomplete. Had the data-set been complete, at least 13,000 further matches would have been made, based on the data. In addition, many deceased frauds are not identified at all.
• The difference between the figures previously published by CIFAS and the research figures published in 2004 was caused by over 40,000 frauds being classified as application frauds rather than identity frauds. In most cases, this was due to falsehoods being identified on applications. Had the CIFAS Members been aware of the deaths from having access to deceased data, the lines of investigation would have changed.
• The research results demonstrated that if deceased data at this time was released to the private sector, then data matching routines to match the data using addresses worked well and will deliver powerful benefits.
• ‘Day of the Jackal’ frauds represented up to 17,500 of the total, where the dead individual was aged 18 or under. Children under 10 represented 2,700 of these cases. These frauds represented a minority of the cases but the distress they caused should not be under-estimated.

Conclusions

CIFAS was able to conclude from this research that:

• Previous estimates (prior to 2004) of the numbers of deceased frauds were too low by a factor of 3.5. The reported figure for 2001 to 2004 of 51,000 should probably be uplifted to 180,000. On the same basis, the 20,000 cases estimated for 2004 was probably closer to 70,000 cases.
• CIFAS Members were correct in describing deceased fraud as the most serious identity fraud problem they face.
• Nearly half of deceased identity frauds were not being identified as deceased frauds, but instead as fraudulent applications. This was due to lack of access to data to confirm deaths.
• CIFAS recommended that deceased data be released by the Government to the private sector for fraud prevention purposes, thus going a long way to preventing these frauds.

Deceased Fraud - The Issues from a CIFAS Perspective

Why Deceased Fraud matters

In 2003 figures published by CIFAS showed at least 16,000 families experienced the pain of discovering their loved one had been impersonated after their death, to open accounts such as credit cards and loans.

CIFAS research in 2004 suggested that published figures were understated by 3.5 times and the UK could expect to see 140,000 cases of deceased fraud a year within 3 years if no action was taken. This represents a huge cost to society. Deceased fraud already cost £250 million a year, so over 4 years, that would mean £1 billion being removed from the legitimate economy with the cost being passed on to consumers within the price of goods and services.

Since late 2000, CIFAS had lobbied the Government to share details of the deceased for fraud prevention purposes. The Department for Work and Pensions, the Treasury, the Home Office and the Department for Constitutional Affairs have all been involved. No-one had ever disagreed that the problem needs tackling urgently and that the solution was to share deceased data.

The outcome

The pain of discovering that a loved one has been impersonated after his or her death, by a fraudster who uses the identity of the deceased person to open accounts such as credit cards and loans, compounds the grief of bereavement.

A change to the law through a clause in the Police and Justice Act 2006 now means that death registration data will be released to the private sector on a weekly basis, by the General Register Office in England and Wales together with its counterparts in Scotland and Northern Ireland, for fraud prevention purposes.

CIFAS was absolutely delighted that the release of the death records has been made possible, and is confident that this new regime will help to stamp out this most insidious of frauds.

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