| Lack of credit fuels rise in fraud |
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| Wednesday, 30 April 2008 | |
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Page 2 of 2 Fraudulent applications for funds An analysis of the residential addresses of identity fraud victims on the CIFAS database at the moment shows that the prevalence of victims is greatest in the following ten postal districts, in descending order: SE18 Woolwich, Plumstead Hurst explains that the figures demonstrate how, in a time of economic change and uncertainty, patterns in fraudulent activity also change. He adds that the increase in application fraud (often to hide adverse credit history) demonstrates that 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. “Fraudsters are becoming increasingly astute in their methods. With some awareness of how lending decisions are made, they are therefore ‘tailoring’ their applications in an effort to beat the system,” Hurst notes. He warns that fraudsters may be realising that large scale fraud is no longer an option so they are cutting their cloth accordingly following the economic downturn, with lenders increasingly using stricter lending criteria. Furthermore, Hurst points out that the alarming rise in facility takeovers suggests that, rather than creating new identities and accounts, fraudsters are increasingly siphoning off what is already available from their victims’ accounts. “In this changing landscape, these figures demonstrate very clearly the need for companies to find increased resources for their anti-fraud departments as the lack of credit available in the legitimate marketplace is already leading to an escalation in financial fraud,” he concludes. Related articles
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