Identity Theft Image by: GotCredit

Identity Fraud (or Theft) is the use of a stolen identity, or credentials, to pursue criminal activity, with the single aim of obtaining goods, services or cash by deception.

Its prevalence is increasing exponentially and the latest available global statistics suggest that it is now the most prevalent form of fraud; accounting for 20.33% of all reported incidents last year. In 2019, the UK saw its highest ever volume of recorded cases, with 364,643 incidents logged in the National Fraud Database; a 13% increase on the previous year. In the same year, there were 3.2 million identity theft and fraud reports received in the U.S., with losses estimated at $1.9bn. Data also suggests that one in five victims have experienced it more than once.

This crime targets unsuspecting individuals and corporations alike. It is multi-faceted and manifests itself in a plethora of guises. Once a fraudster has stolen a target’s identity they have the potential to make purchases, open bank accounts, obtain credit cards, secure personal or business loans and even take over existing accounts. They can also use the stolen data to obtain genuine identity documents, including passports and driving licences, which in extremis, can in turn be used to set up fraudulent corporate enterprises.

Leading the fight back in the UK is the finance industry, which is investing increasing sums in advanced security systems, such as firewalls, biometric security and multiple authentication, to protect its customers, however; whereas recent reports suggest that this is having a significant impact, criminals still successfully stole over £1.2 billion in the U.K. through identity fraud and scams in 2019.

The main reasons why identity fraud is increasing in prevalence, are our increased use of and reliance on technology, the fact that business can now be transacted without any personal interaction and the increasing sophistication with which criminals conduct their activities. The use of computers and handheld devices to conduct activities such as online banking, purchases, bookings etc., means we all now routinely part with confidential information, including: our addresses, dates of birth, passport numbers, banking coordinates etc. Unfortunately, we do so with varying degrees of caution and those that do so without taking robust security measures leave themselves exposed to identity theft.

People are now more willing than ever before to transact business with someone they have never actually met, without first conducting any form of due diligence to verify their identity and credentials. Whereas someone may believe they are engaging with a legitimate individual in London, they may just as easily be talking to a criminal in East Africa, or the Balkans.

The final reason for the growth in fraud, is down to the fact that it is an incredibly lucrative profession and criminals are increasingly investing to enhance the sophistication of their operations. Identity theft investigation must also move at a similar pace to it’s perpetrators.

How to protect yourself or business against Identity Fraud

There are a number of relatively easy measures which can be taken to protect personal information and guard against the theft of our own identity, including obvious means such as the use of anti-virus software, firewalls and using robust and frequently changing passwords, however; guarding against fraud once someone approaches you having already stolen someone else’s identity is somewhat harder.

The only effective means of preventing yourself from becoming the victim in such circumstances, is to conduct due diligence to verify the credentials of the individual who has approached you. This goes beyond simply checking their LinkedIn profile, or searching for their name on a corporate website and more often than not, it requires the appointment of a corporate intelligence and investigations company.

Our recent Fraud Cases and identity theft investigation

At Matrix Intelligence, we regularly investigate cases of identity fraud.

A recent example involved a retired individual who was tricked into investing almost €1 million by individuals posing as a legitimate finance company and offering a “too good to miss” investment opportunity.

As is common in such crimes, the fraudsters only asked for a small initial investment and then having produced fake statements to show market-beating returns, they gradually convinced the individual to invest greater sums. When the victim had seen his funds nearly double, he decided to withdraw them and this is when the relationship turned acrimonious and he was informed that he could only withdraw his funds after a final investment of almost €200k.

When his lawyer approached us for assistance and we reviewed the case, we were able to identify numerous red flags from the victims initial encounter. Had we been engaged to conduct due diligence prior to the initial investment, the client would have prevented the financial ruin which ensued and the accompanying mental anguish.

Another recent example is a case of a fraudster obtaining goods by deception. In this instance an individual approached our client posing as a Director of a legitimate and well known British construction firm. He wished to buy some large items of plant and have them shipped directly to East Africa with the promise of a subsequent larger order if our client could deliver.

Unusually, the individual said they would only pay upon receipt of the items and although this was not our client’s normal practice, he googled the company and the individual and having satisfied himself that they were legitimate, he agreed.

Unfortunately, whereas the firm and individual were indeed well known, that is not who our client was talking to. The fraudster had impersonated a legitimate individual and obtained the goods by deception. Again, had our client conducted proper Due Diligence, he could have avoided the loss in the first place.

What to do if you find yourself a victim of Identity Fraud

If you suspect you may have been a victim of fraud and require identity theft investigation, Matrix Intelligence can assist you by investigating the crime, identifying the individuals responsible and tracing any assets that may be recoverable. For free advice and a no obligation proposal, please contact us on 0203 873 1089 or email: