Print

Credit crunch fraud alert

A new report reveals that fraudsters are taking full advantage of the credit crunch…

According to CIFAS – the UK’s fraud prevention service - fraud cases have leapt by 10% in the first three months of the year compared with the same period in 2007, and that more people have been lying on application forms for loans and credit cards to try to cover up a poor credit history.

Peter Hurst, Chief Executive of CIFAS, commented: "Because people are getting into debt earlier, and because the credit crunch has diminished their access to finance, they are now resorting to fraudulent applications for funds.

“The most frequent lie is failing to disclose a previous address where the applicant had a poor credit history. Indeed, lies on application forms have risen by 13% from 19,239 in the first three months of 2007 to 21,780 in the first quarter of 2008. Such lies are counter-productive as providers shared information and were less likely to offer such a person credit.

Mr Hurst concluded: “Cases of ‘account takeover’ have also risen. This is when a fraudster impersonates a victim in order to control their bank account.  They often break the security by using a spoof email, claiming to be from a bank, to trick the victim into giving their account details.  Cases of account takeover more than doubled from 1,331 in the first quarter of 2007 to 3,276 in the same period of 2008”.