Identity fraud occurs 'every four minutes

A case of identity fraud happens every four minutes in the UK, according to research published today.

Identity fraud occurs when someone uses an individual's personal details - for example, their name, date of birth, address and national insurance number. Often the information is used to apply for credit cards, loans and other financial products, as well as mobile phone contracts, driving licenses or even passports.

Unpaid debts then land on the victim's doorstep, and can result in problems with debt collectors, county court judgements and difficulties getting a mortgage or even a job.

Identity fraud costs the UK more than ?1.3bn a year and projections suggest that by the end of 2004 there will be 130,000 cases - equating to one every four minutes.

According to a survey by Capital One, more than three quarters of people are concerned about identity theft and 22% would like some expert help to protect themselves from it. However, an alarming 96% of British people underestimate the time it takes to show up that you have been a victim of identity theft.

Dan Cobley of Capital One, which will next week launch a free identity theft assistance service for its customers, said: "Cases of identity theft are growing at an exponential rate and consumers are understandably worried. For those people unlucky enough to become victims of this fraud, unravelling the trail of impersonation and trying to prove that you were not the one doing the spending can be very frustrating."

A report by personal protection advisers the CPP Group found that people believed it would take them about 103 days to realise their identity had been stolen, when the reality is actually about 480 days, or 16 months.

The report also found Britons underestimated the time taken for identity theft victims to put their records straight and prove their innocence, which is on average 300 hours.

Stephen Chinn, product development manager for the CPP Group, said: "The longer identity theft goes undetected the more damage fraudsters are able to do using the stolen identities. "The consequences are far-reaching, very stressful and can take the individual a long time to put right."

The report follows the home secretary's announcement of plans to introduce ID cards in the UK. The specialist insurance company St Andrew's Membership Services, part of the HBOS General Insurance, welcomed the government's ID card plans, but reminded consumers a few simple steps on their part could reduce their risk of being targeted.

Colin Whitehair, chief executive of St Andrew's Membership Services, said: "Biometric ID cards, which will be carried by everyone and contain personal information such as an iris scan, are a very welcome tool in the war against ID theft, but new technology can only achieve so much.

"It's very simple for someone who is intent on assuming a new identity to cause havoc and go unnoticed for a long time.

"Credit card receipts left in bars or restaurants, letters thrown away in the rubbish, and online phishing scams coupled with the lazy approach some people have to reading their bank statements plays into the fraudsters' hands."