Fraud hits record levels in 2011

Unemployment and inflation blamed as fraudsters feel they “have no choice”. 

Britain’s economic woes have contributed to record amounts of fraud, figures from the UK’s Fraud Prevention Service have shown.
CIFAS said that overall fraud had increased by 9 per cent, with identity fraud and so-called facility takeover fraud two of the largest risers. Facility takeover fraud is where a fraudster gains access to a victim’s credit card, bank account or mobile phone. This type of fraud has risen by 300pc in the last five years.
“With over 236,500 frauds confirmed in 2011, a larger number than any previous year, this confirms that as austerity bites, economic crime continues to be a stealthy, insidious danger,” said Richard Hurley, of CIFAS. “Many of these frauds will undoubtedly be committed by organised criminal elements, but many will also be committed by people who seemingly feel that their circumstances leave them no choice.”
He added that financial desperation leaves many of us vulnerable to financial scams. These include a 13pc rise in Misuse of Facility fraud, where fraudsters gain access to someone’s account legitimately (for example by trying to involve the person in a ‘Working from Home’ company involving money transfer) and then uses if fraudulently.
Nearly half of all of the fraud in 2001 involved the use of false identities or impersonating an innocent victim. Mr Hurley said that consumers should start “treating data in the same way that we would guard a prized possession” in an attempt to stop identity fraud.
CIFAS Chief Executive, Peter Hurst, said: “With the cost of living increasing, pay levels frozen for many, and tax and VAT changes taking effect, perhaps it is unsurprising that fraud has rocketed again. Prevention, however, remains better than cure, and it is time for all organisations and consumers to start reviewing their approaches to preventing fraud rather than trying and failing to recover losses.
Fraud to look out for in 2012 includes that perpetuated via social media. With more of us using Facebook, Twitter and other networking media, fraudsters are using “social engineering” to extort money. Once a virus infects a user’s computer, it will, when they next visit a site such as Facebook, raid the user’s “friends” list. The virus then sends an email to each friend asking them to click on a link to view a photo or video. The friends trust the name of the sender, click on the link, and in doing so their computer becomes infected. “[The emails] might look like they come from a friend,” Neil Fisher, head of global security systems at Unisys, says. “But click on them and they contain a hidden ‘package’. This could contain keystroke–logging software that will find your passwords and other details.
Alternatively, you may end up with a man–in–the–browser virus. When a user logs on to specific online banking sites, the virus, or Trojan, is activated and intercepts banking data.


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