Cost of ID fraud could reach £3.8bn in four years
Criminal gangs increasingly operating like businesses
ID theft could cost the UK economy £3.8bn a year by 2010 if nothing is done to quell its rise, according to a survey published this week.
Research conducted by 1871 on behalf of security specialist Garlik says costs will almost double from today’s £1.8bn because of an increasingly sophisticated fraud infrastructure that enables criminals to operate in a similar way to businesses.
Stefan Fafinski, author of the report, says the internet facilitates this infrastructure and greatly reduces risk for criminals.
‘Our most startling finding was the move towards the organised nature of crime and how people use the internet and online resources to gather information,’ said Fafinski.
Fraudsters at the bottom end of the criminal spectrum collect information from public sources such as the electoral roll, Companies House, 192.com and social networking sites.
‘This information is then traded on very transient web sites. The problem is there is no law to prevent the acquisition of people’s identities,’ said Fafinski.
Criminals use ‘high-tech tools such as anonymous email accounts, data encryption and proxy computers to evade detection and prosecution’, according to the Garlik report.
Fafinski says the government is trying to increase the punishment for ‘ulterior intent’ offences, in an amendment to the Computer Misuse act.
‘This will have the added effect of making people vulnerable to extradition and will allow us to start flexing a bit of legal muscle internationally,’ he said.
Charlie McMurdie, detective chief inspector at the Metropolitan Police, says electronic crime is a multi-faceted business.
‘The internet is borderless, and arguably it is an easy place to commit crime. There are big financial gains to be had with little risk,’ she said.
‘Organised crime is definitely going online, and policing of the internet is now essential.’
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