Identity theft: a growing fraud threat

Stephen Hill in a special study, looks at the increasing problem of fraud and its implications for benefits, business and advisers.

“Who steals my purse steals trash, but he that filches from me my good name… makes me poor indeed” (William Shakespeare (Othello))

The National Criminal Intelligence Service (NCIS) identified in a recent Cabinet Office report (2002) that identity fraud is a serious and growing problem that costs the UK more than £1.3 billion a year.

The Home Office is reviewing ways of tackling the problem, including consideration of a UK-wide entitlement card. Previous NCIS reports have identified important links between identity fraud and the workings of serious and organised crime, and recommended that these be more closely examined.

Ultimately identity theft is the 'misappropriation of the identity of another person, without their knowledge or consent'.

Identity fraud can be described as 'the use of that stolen identity in criminal activity, to obtain goods or services by deception' (CIFAS). In a recent report by Credit Information Fraud Avoidance System (CIFAS) it was declared that although over 75,000 cases of identity fraud were identified in the UK in 2002, there would have been many more that 'were either not responded or were placed in other crime categories'.

The FBI refers to identity theft as one of the fastest growing crimes in the US and estimates that 500,000 to 700,000 Americans become identity theft victims each year. In a recent survey undertaken by the Federal Trade Commission a report was commissioned highlighting the most frequent identity thefts reported by victims. The results from this report can be seen in the following table in terms of the number of victims and percentage.

Consumer Sentinel Complaint Statistics and Trends
(January 1 – December 31, 2002)

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