Identity fraud cases reach all-time high as cost-of-living crisis bites
12 April 2023
The latest research from Cifas, the UK’s leading fraud prevention service, has revealed that identity fraud is now one of the biggest fraud threats to the UK public, with cases soaring by nearly a quarter over the last year.
This alarming statistic is revealed in the latest publication of Fraudscape, which identifies and analyses the latest fraud trends based on 409,000 cases of fraudulent conduct recorded to the National Fraud Database in 2022.
The report reveals that last year saw 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 filed by Cifas members.
Although the banking sector continued to be heavily targeted, in 2022 there was a significant increase in cases of identity fraud attempted against the plastic cards and telecoms sectors.
Over the last couple of years, the demand for credit card use has grown as a result of households becoming increasingly reliant on credit as the cost-of-living crisis deepens. This, in turn, has made individuals 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.
Most victims of identity fraud are over 31 years, and the data shows that there has been a significant rise in victims aged 61+ as criminals turned their attention to targeting older consumers.
False application
The squeeze on living standards has also resulted in a sharp increase in cases of false application. This refers to where a product or service is applied for using fake supporting information in order to make the individual to appear credit worthy 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, loan products or goods.
Misuse of Facility
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.
However, a large proportion of these cases continue to 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 continues to be 21-25 years, with social media remaining a key enabler in the recruitment of mules.
As the economic crisis deepens, loan products were also prone to first party fraud, with a 114% increase in cases of misuse of a facility in 2022.
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, pin numbers 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.’
Notes to Editors
The Fraudscape report is here and Cifas spokespeople are available for interview.
Cifas is an independent, not-for-profit membership organisation that protects businesses and individuals through effective and secure data and intelligence sharing between the private, public and third sectors. In 2022, Cifas member organisations prevented around £1.6bn of fraud losses.
Cifas data is included in the Office of National Statistics England and Wales Crime Statistics of police recorded crime and works alongside law enforcement agencies in tackling fraud.
For more information, please contact Corinne Gladstone, Head of Strategic Communications, on 020 4551 7072 or press@cifas.org.uk.
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