Chancellor Alistair Darling has come under fire yet again for attempting to cover up the lost records fiasco after it was discovered that the Government could have paid out just £5,000 to remove the personal details of the 25 million people claiming child benefit from the disks before they were sent by mail to London.
According to the Tax Payers Alliance, the cost of preventing the calamity has now spiralled as the expense involved for the banks to change the passwords and accounts of worried customers is estimated to be in the region of £200 million.
The Taxpayers' Alliance calculated that it would cost £20 per customer for banks to answer queries and deal with those wanting to change accounts, PIN numbers or passwords while helplines and credit checks could clock up extra, especially if all 7.2 million families insisted on the changes.
The series of gaffes, detailed in official emails, began in March when a request for names, National Insurance numbers and child benefit numbers of every child was put forward by the National Audit Office in order for it to select 100 random cases for the annual audit of Revenue and Customs.
According to a report in The Telegraph, the emails stated that the NAO wanted bank and other details removed from the discs but officials decided the cost of removing them was unwarranted and sent them on unchanged. Following a second request by the NAO in October, the disk containing confidential details of the millions of families were again sent unedited through the post where they were subsequently lost.
Now, while millions of families race to change the passwords and PINs that protect their bank accounts, Credit reference agency, Experian, is urging people to make sure they keep a check on their finances by getting an up to date credit report which will outline any fraudulent behaviour.
According to the latest Government figures, identity fraud costs the UK £1.7 billion a year and Experian has warned that criminals could use the information, which includes names, addresses and dates of birth for parents and their children, to impersonate them, borrow money in their names and apply for benefits.
Jim Hodgkins, Managing Director of CreditExpert explains: "Fraudsters often attempt to borrow money in their victims’ names, so it makes sense to take steps to protect yourself. As a member of CreditExpert, you can look at your credit report as often as you want over time, which is crucially important because identity thieves may wait years to take over an identity.”
Experian has also recently launched a new service which aims to limit people’s exposure to identity fraud and a damaged credit status. The service will alert banks when lenders are at risk of defaulting on repayments and going into arrears. Triggers for contacting the bank will include two missed credit card payments, exceeding credit limits, or getting a county court judgement, thus affecting their credit histories.
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