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Identity fraud figures
Identity fraud is still a comparatively rare type of crime, but it is a crime that can be very worrying for the victims.
CIFAS figures show cases of identity fraud reported by CIFAS Members as follows:
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Year
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Cases Recorded
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| 2008 |
77,600 |
| 2007 |
77,500 |
| 2006 |
80,000 |
| 2005 |
66,000 |
| 2004 |
56,000 |
| 2003 |
46,000 |
| 2002 |
34,000 |
| 2001 |
24,000 |
| 2000 |
16,000 |
| 1999 |
9,000 |
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Victims
Identity theft is definitely not a victimless crime. In 2007, CIFAS identified and protected 62,500 victims of identity theft.
As the scale and type of identity fraud varies, so does the impact on those whose identity has been stolen. In one-off cases, perhaps involving one fraudulent application or transaction, the damage to the victim may be minimal.
At the other extreme, persistent and skilled fraudsters who comprehensively steal an identity can cause a great deal of distress to victims. It can take between 3 and 48 hours of work for a typical victim to sort out their life and clear their name. In cases where a 'total hijack' has occurred, perhaps involving 20-30 different organisations, it may take the victim over 200 hours and cost up to £8,000 before things are back to normal. They may suffer considerable (albeit temporary) damage to their credit status, which may then affect their ability to obtain finance or insurance - even a mortgage may be temporarily compromised.
However, in the eyes of the law, the financial institutions/lending organisations are considered the only victims, because they are the ones who have been defrauded. As a result, the damage inflicted on the reputation of the victims and the time they spend mending the trail of destruction cannot easily be redressed. Any such compensation needs to be fought for through the civil courts. This is likely to continue to be the case until legislation is introduced specifically to outlaw identity theft, as in the USA.
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Costs
There are difficulties in accurately measuring the impact and extent of fraud in the UK in general, as only detected fraud is recorded. However, the figures available show that:
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At the latest estimate, identity fraud cost the economy £1.2 billion in one year (Identity Fraud Steering Committee figures, 2008).
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The Department for Work and Pensions estimated that £800m was lost to benefit fraud in 2006/7, and SOCA's 2008/09 Threat Assessment of Serious Organised Crime stated that identity fraud is a "major threat in this area."
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Identity fraud accounts for a criminal cashflow of £10m per day.
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In March 2008 there were 76.8 million National Insurance numbers in the UK, with a population of 61 million.
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Plastic card fraud losses totalled £535.2 million in 2007 - with card identity theft accounting for £34.1 million of this figure.
There are proven links between identity fraud and organised crime. Identity fraud is not exclusive to one particular type of criminal activity and cuts across most criminal sectors, including illegal immigration, drug trafficking, money laundering, vehicle theft and fraud against the public and private sectors.
It is worth noting that, whereas statistics may distinguish between fraud against the public and private sectors, fraudsters typically do not discriminate between the two - they merely target the weakest link. The same stolen identity can be used in applications for loans and credit cards, and for multiple benefit claims, tax evasion etc.
Also, how can the cost of a terrorist or a convicted sex offender operating under an assumed identity be measured?
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Why is identity fraud at such high levels?
The number of identity fraud cases in recent years can be attributed to a variety of factors:
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Organised crime traditionally targets the UK.
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It is estimated that the police investigate less than 1% of identity fraud cases. The cases that are investigated consume a lot of police time and resources. The criminal activity often crosses Police Authority boundaries and just one case can involve the investigation of hundreds of bank accounts, and the tracing of the same number of victims.
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Until recently there has been insufficient deterrent to criminals. Sentences in the UK have tended to be relatively light, although with the growth in identity theft and with the implementation of The Fraud Act 2006, there are indications that this is beginning to change. It remains difficult to retrieve the funds obtained by the fraudster or to extract compensation from them, however.
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Fraudsters have, in the past, exploited loopholes in the issue of 'identity documents' such as passports, driving licences and birth certificates. They have therefore managed to obtain official documents to prove a false identity. For example:
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Approximately 2,500 fraudulent applications for driving licences were detected by the Driver and Vehicle Licensing Agency (DVLA) in the 12 month period to March 2007.
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In 2005 more than 4,830 driving tests were stopped due to doubts over the identity of the person sitting the test.
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16,500 fraudulent applications for passports were received by the Identity and Passport Service (IPS) in the 12 months to September 2006.
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