Mail order companies are most likely to be hit by identity fraud, which rose by 69% last year compared with 20...
According to research by credit reference agency Experian, mail order firms were by far the hardest hit in terms of fraud volumes, accounting for about 60% of total cases.
In terms of financial value, the biggest losses were suffered by credit and store card issuers. These accounted for about 28% of the total financial losses, at an average cost per case of £1,548, while loan providers suffered 19% of total losses at an average cost per case of £4,797. With an average cost per case of £229, mail order companies suffered 15% of total financial losses.
Experian public affairs director Peter Brooker said companies were most likely to accept liability if their customers were victims of fraud, which made a direct impact on revenue.
However, he said firms were beginning to use more sophisticated approaches to verify customer identity when applications were made for credit cards or store cards. These include cross referencing previous credit applications to check for changes in other key identifiers such as mobile or daytime telephone number.
“If they get through all the checks at the application stage, fraudsters often bide there time for six or nine months and work a credit card just as you or I would, spending reasonable amounts. Then they max-out the card and disappear.”
Preventing fraud after the application stage involves using software packages to detect anomalous spending patterns on cards, Brooker said.
Consumers could also protect themselves by registering with agencies such as Credit Expert, which can alert individuals when credit checks are made against their names, as occurs during a credit card application.
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