2015 was the year current account fraud surged and new figures show it is still the most targeted financial product. The fraud rate in current account applications soared last year from 73 in every 10,000 applications in January to 156 in every 10,000 applications in December.
Current account fraud not only presents the immediate threat of emptying a person’s overdraft facilities, but also often acts as a ‘gateway’ to further fraudulent activity. Fraudsters can use information gained from a successful attempt to then open other financial products such as loans or credit cards.
The increase in current account fraud has also been a factor in tipping the overall balance between first party fraud and identity fraud. At the start of 2015, 51% of detected and prevented fraudulent applications across all financial products were attributed to first party fraud whilst 49% were a result of identity (third party) fraud. By the end of the year this balance tipped significantly, with 59% of fraud now accountable to identity thieves.
Nick Mothershaw at Experian, comments: “Current account fraud really came to the fore in 2015, with identity thieves acting as the chief culprits. The positive side to this is that these numbers represent detected and prevented fraud attempts, demonstrating the robustness of the protection systems in place for financial products.
“While it is clear that the systems are working, both companies and consumers need to remain vigilant to the evolving tactics of fraudsters which become more sophisticated with each passing day.”
While fraud across most other financial products has remained at a consistent rate in the last year, credit card and insurance policy fraud also saw a substantial increase.
The credit card fraud rate stood at 36 in every 10,000 applications in January 2015 but increased over the course of the year to 55 in every 10,000 applications. Similarly, insurance policy fraud stood at 37 in every 10,000 applications at the beginning of the year but increased to 68. As with current account fraud, credit card fraud was also largely driven by identity theft.
Experian’s interactive fraud dashboard provides the latest insight for those wishing to stay up to date. It is the first of its kind in the UK and shows fraud rates by financial product as well as regional hotspots and high profile fraud facts. Please visit the dashboard here.
Source: Experian PLC