DECEASED FRAUDS – RESEARCH RESULTS – DECEMBER 2004

Background

For the last 4 years CIFAS Members have reported substantial increases in deceased impersonation frauds.

Figures are hard to come by due to the reporting mechanisms being largely manual, 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. Adding together the reported and projected figures, the total for the period 2001 to 2004 is:

In 2004 Members of CIFAS have 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 has been 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 is virtually 100% coverage of deaths but for more recent deaths in the last two years the percentage varies from 0% shortly after a death to 75% later on.

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

The Results

The research results provide the clearest indication yet that deceased fraud is occurring on a scale greater than previously indicated. The results show:

• 97,000 matches made up as follows:

• The majority relate to the period 2001 to 2004 where existing reporting mechanisms produced a figure of 51,000. We now estimate the scale of the UK problem not at 51,000 cases since 2001 but 180,000. This figure is based on the 97,000 matches from the research and a 50% uplift to include cases not recorded as frauds but as collections cases or written off unpaid debts. This is likely to be an under-estimate as the deceased fraud data-set used in this research exercise is 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 is 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 have demonstrated that if deceased data is released to the private sector, data matching routines to match the data using addresses work well and will deliver powerful benefits.
• ‘Day of the Jackal’ frauds represent 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 represent a minority of the cases but the distress they cause should not be under-estimated.

Conclusions

• Previous estimates of the numbers of deceased frauds are too low by a factor of 3.5 times. 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 is probably closer to 70,000 cases.
• CIFAS Members are correct in describing deceased fraud as the most serious identity fraud problem they face.
• Nearly half of deceased identity frauds are not being identified as deceased frauds, but instead as fraudulent applications. This is due to lack of access to data to confirm deaths. Many more deceased frauds are not being identified at all.
• Should deceased data be released by the Government to the private sector for fraud prevention purposes, these frauds could be prevented.

Deceased Fraud - The Issues from a CIFAS Perspective

Why Deceased Fraud matters

Impersonation of the dead is now Britain’s fastest growing identity theft crime. 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.

In recent years there has been a rapid growth in the number of cases:

Since late 2000, CIFAS has 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 has ever disagreed that the problem needs tackling urgently and that the solution is to share deceased data. So why after nearly four years is data sharing not happening?

Why does it matter?

Imagine if you were 80 years old. Your partner of 50 years has died after a long illness. Now you have only the memories of 50 years together, wondering how on earth you will possibly get through the next year alone. The family came for the funeral but they’ve all gone home now and you just receive the occasional call or visit. Then you start receiving credit card and bank statements, letters about missed payments, telephone calls demanding money, a visit from a debt collector. No-one will believe you. You do not owe anyone any money, but you start to pay one or two of the debts off, thinking that your partner must have borrowed without you knowing – and hoping that the debt collectors will go away and leave you alone with your grief.

This is not a far fetched scenario – it happens in Britain today. One elderly victim from the Rhondda valley in South Wales said the fraudsters were ‘stealing the memories’ she had of the good times with her late husband and replacing them with misery.

There are very few crimes where one single and simple measure – sharing details of the deceased – will make such a huge difference to victim’s lives. We could reduce the number of cases to almost zero at a stroke. To take no action is a lost opportunity to reduce crime and to assist some of the most vulnerable members of the communities in which we all live. We could stop nearly all these cases from happening if the Government shared details of the deceased with private sector organisations like CIFAS.

To their credit the Government has recently recognised ‘there are strong public interest arguments for sharing information’ to prevent fraud and ‘to avoid the identities of the deceased being used for fraudulent purposes’, but there are still no plans to release deceased data. If we are serious about reducing crime in this country, it should be released without further delay.

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