A New Identity Fraud Victim Every Two Seconds in 2013
Author:
Nancy Ozawa
Location: San Francisco
Date: 2014-02-06
The 2014 Identity Fraud Study released today by Javelin Strategy & Research, reports an increase of more than 500,000 fraud victims to 13.1 million people in 2013, the second highest number since the study began. Account takeover fraud hit a new record in incidence for the second year in a row and accounted for 28 percent of all identity fraud. Additionally, fraudsters increasingly turned to eBay, PayPal and Amazon with the stolen information to make purchases. In 2013, data breaches became more damaging, with one in three people who received a data breach notification letter becoming an identity fraud victim. Encouragingly, the amount criminals stole decreased by $3 billion to $18 billion, reflecting more aggressive actions from financial institutions, identity theft protection providers and consumers. “Consumers and businesses cannot let up the effort. Our study found that criminals are adapting their approach to focus on account takeover and they are effective at using the information they secure from data breaches. Any complacency will provide fraudsters renewed opportunities.” Now in its eleventh consecutive year, the comprehensive analysis of identity fraud trends is independently produced by Javelin Strategy & Research, and made possible by Intersections Inc., a company dedicated to consumer fraud prevention and education. It is the nation’s longest-running study of identity fraud, with 53,800 respondents surveyed over the past 11 years. Identity fraud is defined as the unauthorized use of another person’s personal information to achieve illicit financial gain. Identity fraud can range from simply using a stolen payment card account, to making a fraudulent purchase, to taking control of existing accounts or opening new accounts, including mobile phone or utility services. In October 2013, Javelin Strategy & Research conducted an address-based survey of 5,634 U.S. consumers to identify important findings about the impact of fraud, uncover areas of progress and identify areas in which consumers must exercise continued vigilance. “There were significant strides forward in 2013 in the fight against identity fraud. Even though the incidence of fraud increased, the amount stolen significantly decreased,” said Al Pascual, Senior Analyst of Security, Risk & Fraud, of Javelin Strategy & Research. “Consumers and businesses cannot let up the effort. Our study found that criminals are adapting their approach to focus on account takeover and they are effective at using the information they secure from data breaches. Any complacency will provide fraudsters renewed opportunities.” Key Findings The study found several significant identity fraud trends:
Six Safety Tips to Protect Consumers Javelin Strategy & Research recommends that consumers work in partnership with institutions to minimize their risk and impact of identity fraud by following a three-step approach: Prevention, Detection and Resolution™. Prevention 2. Opt-in to two-factor authentication wherever it is offered — Some financial institutions, alternative payment providers and other service providers offer the option of adding a layer of security to your account beyond the basic username and password. By enrolling in this service, you will be notified each time someone tries to access your account, allowing you to block out fraudsters and address the issue in real-time. 3. Just say No to SSN authentication — Eighty percent of the top 25 banks and 96 percent of top credit card issuers will allow account access using your Social Security Number (SSN) as an authenticator. Since SSNs can’t be changed, they are valuable to fraudsters. To limit exposure, request that your financial institution place a note on your account that you will never provide your SSN when requested as a form of authentication. That way, they will know never to ask since anyone who attempts to access your account with this information is a fraudster. Detection Resolution 6. Don’t wait. Report problems immediately — If you suspect or uncover fraud, contact your bank, credit union, wireless provider or protection services provider to take advantage of resolution services, loss protections and methods to secure your accounts. A fast response can enhance the likelihood that losses are reduced, and law enforcement can pursue fraudsters so they experience consequences for their actions.
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