For the first time, current accounts have become the most targeted financial product by fraudsters. At least 89 in every 10,000 applications for a current account are made by an imposter, according to credit checking firm Experian‘s figures for January to March 2015.
This rise over the past year has been driven by an exponential increase in identity fraud. At the end of Q1 last year, 32 per cent of fraudulent current account applications were attempted people who had stolen an identity, but by the end of Q1 2015 this figure had jumped to 49 per cent.
The trend has come as criminals continue to probe for weaknesses in the seven day switching system. As well as offering a quick win for fraudsters withdrawing overdraft facilities, current accounts can also offer criminals a stepping stone to apply for a wider range of financial products using stolen details.
Nick Mothershaw, UK&I Director of Identity & Fraud at Experian, said: “Recent figures from the Payments Council shows that there has been a 7 per cent year on year rise in current account switching. While fraudsters may be taking the opportunity to test the security of lenders systems, increased detection rates are showing that their systems are clearly holding up.
“It is important for people to take measures to ensure their details remain their own. Knowing what your bank can and cannot ask you for will help you avoid phishing scams. Making sure sensitive mail is shredded is also important. Keeping an eye on your credit report can help you spot any suspicious activity.”
For those wishing to stay up to date with the latest insights, Experian has launched a new interactive fraud dashboard, the first of its kind in the UK. The dashboard shows fraud rates by financial product as well as regional hotspots and high profile fraud facts. To access the dashboard simply input your details and follow this link and you will also receive a copy of the latest Experian annual fraud report.
Current account fraud has now surpassed mortgage application fraud, which until now had been the biggest target – 83 out of every 10,000 applications, the firm adds.
