45% of all fraud is data-driven

Identity fraud that uses victim data to access accounts or open new ones makes up nearly half of all existing fraud, according to the fraud prevention service Cifas.

Over 100,000 people have been the victims of data-driven fraud each year since 2010 and 90,000 have already been identified so far this year. Cifas  says that these figures highlight the seriousness of the threat facing consumers, businesses and financial institutions.

The widespread shift towards online services has seen an explosion in fraudulent activity involving the harvesting of passwords, emails and personal data obtained through hacking attacks and social engineering. While the 45% does, promisingly, mark a slight decline from recent years, this form of fraud is still very much the norm, says Cifas, and identity crimes present a major challenge to the financial wellbeing of organisations and consumers.

For the modern fraudster, knowing somebody’s personal or financial details is a licence to print money and the continuing preponderance of such data driven financial crime must serve as a warning,” said Richard Hurley, communications manager for Cifas. “Defeating it means we have to demand that organisations do more to handle our data securely, and ramp up their fraud prevention efforts. Individually, however, we also have a responsibility to look after our own details. Without doing so, we are effectively handing access to our bank accounts to a complete stranger.”

While many organisations have put into place robust and comprehensive strategies to combat online crooks, and have empowered their customers to do the same, that does not mean all organisations have done so,” agrees Cifas Chief Executive Simon Dukes. “Every organisation and person must now, surely, recognise that if they do not co-operate with others in terms of identifying and implementing good practice, data sharing and responsible online behaviour then they instantly become the weakest link in the chain. This means that they encourage fraudsters to continue their crimes, damaging us individually and collectively.”