Experian data reveals that struggling families are increasingly being targeted by fraudsters 

Number of fraud victims in the UK has more than doubled in the last two years at a cost to credit industry efficiency

Families in Britain who are struggling financially are increasingly becoming prime targets of financial fraud, according to new research from Experian. This group, made up of more than 4 million* people in the UK, have experienced the highest growth rate in fraud between 2014 and 2016.

Of all the fraudulent credit applications made using an individual’s personal details, this low-income demographic, which often faces financial pressures, experienced an increase at double the rate of any other group. Recognising that these families are often dependent upon credit and loans, and likely to make several credit applications per year, criminals are using this intelligence to their advantage.

“Analysis of Experian data from 2016 shows that fraudsters are unscrupulous in targeting young people and families who are already under financial pressure. When a person makes a credit application they are likely to receive information about the application, or a card and pin, in the post. Fraudsters are intercepting this post, to gain control of the credit facility.” explained Nick Mothershaw, Director of Fraud and Identity Solutions at Experian.

“Cyber criminals are making the lives of those struggling to make ends meet even tougher, that’s why businesses should be sensitive to their needs and check customer records against a range of data sources and apply graduated levels of fraud risk response behaviour to suspicious behaviour. It’s important to support genuine customers without disrupting relationships.”

Representing 8% of the UK population, people in this vulnerable group are typically in their twenties and thirties, have very low incomes, or are unemployed or in low-skill and low-wage jobs. They usually rent their homes from a social housing landlord and have very limited savings, investments, pensions or retirement provisions.

Help your customers avoid becoming a victim of fraud by encouraging them to:

1. Always shred or destroy documents that contain personal information before throwing them away.
2. Never respond to cold phone calls or e-mails asking for account details, PINs, passwords or personal information.
3. Don’t give too much away on networking websites. For example, pets’ names or children’s names which might be used as passwords.
4. Register to vote at their current address. If they don’t, thieves could use their previous address details to open new credit accounts, and run up debts in their name.
5. Monitor their post regularly so they know when to expect important documents — and when to act if they don’t arrive.
6. Redirect mail via the Post Office / Royal Mail if they move house.
7. Always use secure, unique passwords for as many online accounts as possible, and ideally all of them. At the very least have a unique password for each type of service provider such as financial services, retail services and email.
8. Don’t store account names and passwords on their smartphone, either in email, as a note, or to ‘autocomplete’ when they open a website or app. It will be a goldmine for fraudsters if the device is lost or stolen.
9. Read all bank and card statements regularly to check for suspicious transactions.
10. Check their credit report, because it lists their credit accounts and what they owe, so they can spot applications and spending that are nothing to do with them.

“It’s very easy for people to lapse into the assumption that fraud is something that happens to someone else,” continued Nick Mothershaw.

“However, businesses have a responsibility to be vigilant and take measures to help customers protect themselves, online and offline. The threat is growing and it requires all parties to be extra vigilant.”

Experian’s ID Fraud Tracker, a quarterly analysis of fraud rates across a variety of consumer financial products, reveals a 203% increase in the total number of fraudulent credit applications over the last two years. Current account, credit card and loan fraud were the most common types of credit products that fraudsters applied for in other people’s names, making up 94% of the total.

Households with high salaries, large disposable incomes and accruing assets remained another priority target for criminals, accounting for 35% of all third-party fraud (fraud committed without the knowledge of the person whose identity is used) in 2016.

Young professional families with children, and mature families with older children, also continue to be fraud targets because of their higher levels of income. Making up 28% of the UK population, and representing 17 million individuals collectively, these groups tend to live in market towns and cities across England.