Fraudsters finding new opportunity in direct debits and ‘social engineering’

30 October 2007
Fraudulent direct debit payments and the gathering of personal information are providing criminals with a new way of committing identity theft, as figures continue to rise and Brits aren’t taking the necessary preventative precautions.

Fraudsters are taking advantage of people’s laziness and failure to track each payment on their bank statements by setting up direct debits into their own accounts, stealing small amounts so as to stay off the banks’ radars.

People and banks often do not notice the small amounts being taken and the crime goes undetected, so it is up to the individual to take action by scrutinizing their bank statements and list of direct debits, and then contacting their bank if they notice anything amiss in order to protect themselves.

The other new method of stealing from people by first stealing their identifies is what the authorities have deemed ‘social engineering’, whereby private details are used to order new cards and PINs which are then used to verify the fraudster’s identity with the victim’s bank account or mortgage provider. A gang has recently taken over the bank accounts of at least 10 people and stolen hundreds of thousands of pounds, taking £60,000 from one victim by transferring it from his mortgage account to his current account and then spending it.

The figures for 2007 are quite gloomy, with plastic card fraud up 26 per cent for the first half of the year, and card fraud abroad has doubled, but losses from online banking fraud have fallen by 67 per cent, according to research carried out by the UK payments association APACS.

In a recent survey that named the top ten countries which send out the most spam mail via the internet, Britain came in tenth, accounting for 2.4 per cent of junk messages that are sent, often fraudulently obtaining personal details by posing as a bank.

Spammers are using increasingly ingenious methods of luring unsuspecting people into clicking on links that take them to a bogus website – nine million spam messages were sent out over the course of 48 hours in 2006.

Peter Hurst, chief executive of CIFAS, the UK's Fraud Prevention Service, says: “No-one should be complacent about identity fraud. The effect on victims can be devastating.”

Find out more about how to detect identity fraud and how to prevent identity fraud

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