NOTTINGHAM, England—2015 was the year current account fraud surged and new figures show it is still the most targeted financial product, a new report reveals.
The fraud rate in current account applications soared last year from 73 in every 10,000 applications in January to 156 in every 10,000 applications in December, according to Experian.
Current account fraud not only presents the immediate threat of emptying a person’s overdraft facilities, but also often acts as a “gateway” to further fraudulent activity, Experian explained. Fraudsters can use information gained from a successful attempt to then open other financial products such as loans or credit cards.
The increase in current account fraud has also been a factor in tipping the overall balance between first-party fraud and identity fraud, the company stated. At the start of 2015, 51% of detected and prevented fraudulent applications across all financial products were attributed to first-party fraud while 49% were a result of identity (third-party) fraud. By the end of the year this balance tipped significantly, with 59% of fraud now accountable to identity thieves, Experian said.
“Current account fraud really came to the fore in 2015, with identity thieves acting as the chief culprits,” said Experian’s Nick Mothershaw.“The positive side to this is that these numbers represent detected and prevented fraud attempts, demonstrating the robustness of the protection systems in place for financial products. While it is clear that the systems are working, both companies and consumers need to remain vigilant to the evolving tactics of fraudsters which become more sophisticated with each passing day.”